The difference between 720p and 1080p for gaming is very noticable.

Not unless you're on about PC gaming as 99% of PS3 and 360 games are upscaled from 720p.  In that case it's more indicative of a poor scaler in your display rather than the resolution that's making the difference.  If you mean in future that the difference will be noticable then I conceed you're correct , provided games are rendered at 1080p natively.  I still think there is a market for 720p 3D gaming next gen though as I don't think displays are cheap enough to do 1080p 3D gaming widespread and the consoles will not have the horspeower either.

Oh yes, I meant PC gaming. My friend has a 1080p monitor and Battlefield 3 wasn't running so smoothly. He said he would drop the graphics settings but I told him to drop the resolution to 720p, I couldn't believe how much of a difference it made.

It's a double whammy when you drop the resolution because as soon as you go below a panels native resolution you always get the slightest "fuzz" on edges.  In the scenario you mentioned a 720p panel would actually probably look better and sharper than your friends 1080p TV at a 720p resolution, it would be sharper and reduce the perceived quality gap.  It's just another limit of the display technology.

Not sure if you're talking about something specifically related to PC game settings or not; I don't game on PC and am not schooled in this area.  But if you're referring to HDTV panels, that's not the case.  A good 1080p panel displays 720p every bit as good as a native 720p TV.  Of course, there can always be exceptions, but that's not a limit of the display technology, but rather the fault of a specific TV, and is definitely the exception, not the rule.

I heartily disagree, a good 720p panel can be better at displaying a 720p signal than a 1080p panel.  It's a simple fact that if a panel is sent a input signal at it'as native resolution with no scaling required to match the input to the display then it will be superior to one that is scaled.  The exception is of course 720p devices that have resolutions of 1366x768 for example because although they are 720p displays they are not Native 720p (which is 1280x720) so every input is actually scaled on these display devices.  The reson this occurs is if you have to display a 1280x720 signal into a 1920x1080 display there is no nice division of pixels so you will get pixel overlap that the TV's scaler will compensate for, it just isn't as sharp as viewed originally. 

There is a lot more to it and generally speaking you would be mad to not buy 1080p today given prices but it is incorrect to say a 1080p is better than a 720p TV for all circumstances because it just isn't true.  There are plenty of sites that explain this in far more detail, it's all to do with input signal resolution, digital scaling and output resolution.

I will concede that a 720p set can display 1280x720 content slightly clearer than a 1080p set, as it is always best for the source material to match a panel's resolution pixel for pixel.  The less scaling, the better, no doubt about it.  So I agree with you there.

However, saying, "as soon as you go below a panels native resolution you always get the slightest "fuzz" on edges.", I still contest.  1080p TVs of today are built to properly scale 1280x720 res (921,600 pixels) to 1920x1080 res (2,073,600 pixels).  A 720p image is upscaled on a 1080p TV by inserting additional rows and columns of pixels so as not to cause distortion. One new row after each existing row and one new column after each existing column of the 1280x720 frames received.

Again, it is a case by case basis on how well a TV scales.  A TV that performs poorly could indeed result in picture anomalies.  However, I've seen 720 res content on over a half a dozen 1080p TVs (including mine) and there are no visual anomalies whatsoever.  It's indiscernible from the same 720 source (PS3 and Xbox games) being dispalyed on the two native 720p panels I'm familiar with... even if not pixel for pixel (so, theoretically not as clear), definitely none of the "fuzz" you mentioned.

Now when 480 res content (such as a DVD) is upscaled, there is almost always visual artifacting, as information is added based on existing pixels.  Again, the more it has to upscale, the more flaws that are present, and the original resolution is not based around being upscaled.  The difference between that and 1080p panels scaling 720p content, is again, that they are designed to accomodate the scaling of a "fixed resolution" properly.

i didnt not expect to see this thread go to 150 posts

idk whats all this talk about some 55 inch samsung tv with 240hz being superior to a plazma for GAMING which its what this thread is about

the only reason for all that gimmicky broken tech of motionblow and all the other different words each brand has for it is b/c of the LCD tech, if LCD didnt cause blur and trailing while panning there would never be 120 and up hz this is why plasma and crt are still really 60hz

from my experience with anything over 60hz it does cause input lag and causes artifices on the reticule, hud and character while gaming and there are plenty of youtube vids to prove it

go test your 55 inch samsung with it 240hz on then completely off with a shooting game, by press the fire button and see if theres any difference in reaction time,

Good news, I get to reconsider my TV purchase. That one LED i orderded isnt coming, because there was some mistake in mz ordering process or something. So iget to choose a new TV. Hopefully, I'll find an affordable Full HD plasma this time

As far as plasma goes, I'd suggest Panasonic. Do some research for specific models and see what the reviews are. You should seriously consider spending a couple of days browsing some of the places linked in this thread. You'd be surprised how (well maybe not after this thread) many times you can change your mind based on research. It's a big purchase that you want to be happy with so I think it's worth the effort to look into it for a couple of days before you pull the trigger. Good luck.