Simple: compared to 720p or other lower res, both kinds of 1080p offer smoother edges and, at parity of screen size, the ability of not seeing a pixellated image even from a shorter distance, but native 1080p can offer finer, richer details too. For example, with both you'll be able to draw a tiny insect avoiding its legs and antennae looking jagged, but with native 1080p you'll be also able to draw thinner legs and antennae, more detailed patters on its exoskeleton, etc.

An upscaled image is stretched.  So detail is not as fine as a native image at the same resolution.

Open MS paint, paste a 1280 x 760 image, any image.   Then select resize and change the pixels to 1920 x 1080.  

Notice how much more blurry those pixels become.   Granted most TV's have a program to help reduce that blurryness and sharpen the image but it's still not as clear and sharp as a native 1920 x 1080 image.

Not the best example but it can help you understand.

is that a teaser for something?

Yes, I should have added this to my explanation: an image upscaled in a cheap, unrefined way could actually lose quality, some kind of not too coarse interpolation, even better some smoothing and antialiasing is needed to at least enjoy some advantages of higher res, even without the higher detail of native higher res.

lol lol lol I forget the image.

Left 1080p upscalled... right 1080p native (but recompressed in jpeg several times).

Source: http://www.gamespot.com/forums/topic/25746905

hmm okay okay thank you now I know!

those pics are laughable
i even doubt they are 480p (the upscaled "1080p")

Actually, according to Tom Crago, CEO of Straight Right (porting Mass Effect 3 to the WiiU) the WiiU does have hardware upscaling.

Edit: And according to Activision:

http://www.cubed3.com/news/17292