I don't quite know what you mean by "PS3 picks it up". When you connect your PS3 with a HDMI/DVI cable, the PS3 may not determine which resolutions are supported, so it may display every option.
If you are choosing 720p, the monitor goes black for 30 seconds, and then it switches back to 480p, that is because the PS3 is popping up a "confirm" screen and you aren't confirming it because you can't see it. Choose 1080i instead and see if that works.
More information would help us help you. I've used a HDMI/DVI cable to my monitor and never had a problem with it.








