To further explain the 1080i thing, the maximum 1080i (i = interlaced) can show is 30fps, and even worse, if the source material is rendering at more then 30fps, you will inevitably get horrendous interlacing artefacts... 720p (p = progressive) can display upto 60 fps, and being progressive you don't get any issues with interlacing..
For TV, 1080i is preferable over 720p since this is encoded at an exact 25 or 30 fps, and synchronised in such a way that interlacing does not produce artefacts on most TV's..
On top of all that, the resolution the console is 'sending' to the TV does not indicate the actual resolution the games is being rendered at, since the TV standards are 1280 * 720 and 1920 * 1080, games can be rendered at lower resolutions, but have to be then 'scaled' to be transmitted to the TV.
Lots of games do this 'trick', GT5 is rendered at 960 * 1080 and stretched horizontally to fit into the TV standard 1920 * 1080, Halo 3 (360)/GTA IV (PS3) are rendered at what is technically 640p, but then 'stretched' to fit the TV standard 720p..
For example,
For TV, 1080i is preferable over 720p since this is encoded at an exact 25 or 30 fps, and synchronised in such a way that interlacing does not produce artefacts on most TV's..
On top of all that, the resolution the console is 'sending' to the TV does not indicate the actual resolution the games is being rendered at, since the TV standards are 1280 * 720 and 1920 * 1080, games can be rendered at lower resolutions, but have to be then 'scaled' to be transmitted to the TV.
Lots of games do this 'trick', GT5 is rendered at 960 * 1080 and stretched horizontally to fit into the TV standard 1920 * 1080, Halo 3 (360)/GTA IV (PS3) are rendered at what is technically 640p, but then 'stretched' to fit the TV standard 720p..
For example,