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Kyros said:
"he thing is most people will see a difference from SD to 720P or 1080i but not from 720P or 1080i to 1080P"

like all too simple answers this isn't true as well. Every PC gamer can tell you that there is a big difference between 1024*768 and 1600*1200 for example. It depends on the size of the screen and your distance to the screen if it helps a lot or not so much.
But it is true 720p is the more important step, 480 lines is simply terrible and everything is blurred.

So it isn't true yet at the end it is true? I am sure PC gamers can tell me alot of things... like it depends on the size of the screen and your distance to the screen if it helps alot or no so much etc.  Again I am sure there are some people that will see this difference and pay for it etc but for most they won't which I feel slows down HD adoption rate especially 1080P.  By the way I did put a disclaimer that this was mainly about movies and tv shows.