I seriously doubt Xbox 360's ability to do 1080p

http://gear.ign.com/articles/735/735860p1.html

To try to get to the bottom of this situation, IGN contacted Microsoft
and asked a few tough questions. Plenty of questions remain -- we're
waiting to hear even more from the company -- but here's what we have
so far.

IGN: Will games begin to be developed with 1080p as the native
resolution, or is the 360's new 1080p support an advance in the
console's internal scaling abilities?

Microsoft: If developed, the Xbox 360 will support playback of native
1080p games and all existing Xbox 360 titles can be up-scaled to 1080p.

IGN : Does the Xbox 360 have the internal bandwidth between CPUs and
graphics processors necessary to move a full 1080p image? There's a big
difference between 1080i and the 3GB/s of 1080p.

Microsoft: No Comment.

IGN: There are very few 1080p native HDTVs that accept 1080p via
Component connections. The signal will only come in as 1080i and be
de-interlaced back to 1080p. How is the 360's new 1080p support, in
practical application, going to be any different than what was already
possible?

Microsoft: We can offer 1080p support through both the VGA connection
and the Component connection.

IGN: Could Microsoft theoretically release an HDMI dongle-cable like
the various other cables already available for the console? Is the
current 360 hardware able to output a digital signal, or is it
restricted to analog?

Microsoft: Xbox 360 supports HD Component video output, which is
compatible with nearly every HD ready TV on the market today. That's
not yet true for HDMI. We are watching the market closely and will
continue to evaluate our solution, in the face of consumer demand.

Microsoft's current response doesn't yet explain how the company can
rectify its claimed support of 1080p with the fact that the 360 doesn't
support the connection (HDMI) that will actually allow most 1080p HDTVs
to display the signal. While the VGA solution may work for a minority
of 1080p HDTV owners, we're left wondering if Microsoft is promoting
this new 1080p capability primarily to blunt the onslaught of the
PlayStation 3, which supports HDMI and 1080p. Direct information
regarding whether or not the current X360 hardware is able to output a
digital signal would clarify the entire situation, but Microsoft hasn't
been able to answer this question.

Back in the days before the 360 launched, Microsoft stated that HDMI
wires for the Xbox 360 would be released "when the market called for
them." If the Xbox 360 is really going to be a 1080p machine, we're
pretty sure the market is calling for HDMI wires right now. The next
question is whether Microsoft will hear it.
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this question and non-answer was especially telling


IGN : Does the Xbox 360 have the internal bandwidth between CPUs and
graphics processors necessary to move a full 1080p image? There's a big
difference between 1080i and the 3GB/s of 1080p.

Microsoft: No Comment.


....................it doesn't matter what cables are (VGA, component,
HDMI) if a machine isn't capable of rendering true 1080p native
resolution to begin with........

I question the ability of the Xbox 360 to do true 1080p knowing the
bandwidth constraints.
the main external bandwidth in Xbox 360 is pretty low (22.4 GB/sec)
the internal bandwidth EDRAMProcessing Logic of the second graphics
chip is very high (256 GB/sec) but that might not
help the Xbox 360 hit 1080p.


the Xbox 360 is at heart, a 720p machine with the ability to do 1080i
also, but the software upgrade for 1080p seem very hollow.