he's tv doesnt support 720p i think. Which is really weird.

The 360 comes with a scaler chip, whereas the PS3 does not. Probably came out of their design when they were doing their cost cutting (along with second HDMI port, etc).

Yes, the lack of true scaler chip is probably the most annoying thing about PS3 for me, and probably what is going to kill my current TV since every times there's a resolution change my TV just go bongo for several seconds trying to readjust to new out put. This is most annoying when watching blu-ray when it has to switch from 1080p back to 720p when watching the extra content.

Anyway, I feel for you (lucky for me my first HD TV died under warranty and the new set support the 1080p).

I have a set in the bedroom that only support 1080i , funny thing it's a Sony (almost HD set).

You want the textures stretched? why the heck would you want to purposely make a game look worse?

there were quite a few years where 1080i was pushed, it is better than 480p (or edtv), but 1080i lost out on certification for high def standered so it fell out of favor, i am suprised there has not been a good firmware update to support it, since sony was big on 1080i. honestly with the rarity of 1080p sold to consumer and data for it, im really surprised that both the 360 and ps3 spend time makeing games for that def, rather than just scaling 720p acording to tv output

 In fact ,this is wrong,as the PS3 DOES have a hardware scaler chip ,although more limited that the 360 one.Sony only allowed the access to that chip since firmware 1.80 and only for horizontal scaling.Its unknow if they only allowed horizontal scaling because the limits of the chip or because they dont want to allow full scaling for something related to their movie business.

http://www.dailytech.com/article.aspx?newsid=5881

you are a minority, and the ps3 does have scaler, its generally built in feature in the gpu since ancient times.

most of HD tvs support 720p 90%+

1366 X 768p its standard in all HD TV sold here.

most newer tvs do, he most likely has an hd tv form prior to 05... even into 06 1080i was very common.

 I'd bet you a dollar to a doughnut that it's a hardware issue, rather than a business decision.

mmmm doughnut.. sadly because of inflation  doughnuts are almost more than one dollar now