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Mr Puggsly said:
Resolution matters in the sense better is preferable. But the difference between 720p and 1080p is not significant enough to the average consumer.

We've never seen the masses move to a platform solely for graphics. PS4 is successful for getting the price right and having strong software.

While the difference between 1080p and 720p is perhaps not big enough to largely sway the average consumer, when coupled with the cheaper price it becomes a big deal. Being $100 less than the X1 helps Sony sell PS4's, being $100 cheaper and giving a "better experience" not only adds value to the PS4, it detracts value from the X1.

Regardless, i'd always put in-game fidelity ahead of resolution. I'd say give it a couple of years and the resolution of 1st party games on both will be about the same. I'd rather 900p/30fps with extra in-game polish than 1080p/30-60fps. Imagine how much nicer Killzone:SF would have looked :/