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There isn't a big difference between 1080p and 720p.

What's going on:

Unlike CRT TVs, LCD TVs have only one native resolution. Everything that don't have that res is upscaled/downscaled. So when you send an image to the TV that doesn't match the screen native resolution (like that 720p image from a PS3) it looks like trash because it's the TV the one upscaling it to 1080, and they usually do a poor job at it.

Your X360 720p games look good because the X360 takes the 720p game image, upscales it to 1080p and then sends it to the TV.

So: Use a 720p TV for games with 720p output.