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The biggest advantage resolution has in video games is the higher the resolution the more easily it smooths out aliasing isssues. 1080p is going to be MUCH better in this regard than 720p or even 900p though the difference between 900 and 1080 is rather small.

Resolution is a much bigger deal than many in this thread are saying. Im not sure its on purpose though as I think most people struggle with understanding image quality in general and what to look for. Many times I've seen someone say a game with vastly inferior image quality looks "better" than the higher fidelity image. This usually comes down to art style and setting, but personally I just can't stand bad image quality in general anymore, and its the biggest turn off for me in terms of graphics. I would much rather trade off some effects for great anti aliasing and high resolutions.