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Yes, the lack of true scaler chip is probably the most annoying thing about PS3 for me, and probably what is going to kill my current TV since every times there's a resolution change my TV just go bongo for several seconds trying to readjust to new out put. This is most annoying when watching blu-ray when it has to switch from 1080p back to 720p when watching the extra content.

Anyway, I feel for you (lucky for me my first HD TV died under warranty and the new set support the 1080p).

I have a set in the bedroom that only support 1080i , funny thing it's a Sony (almost HD set).