The amount of resolution in a 35mm movie frame is somewhere between 1400 lines in the master film print and about 750 by the time it's duplicated and played in a movie theater. That's all but there is more horizontal content in the wider screen formats in film. I just saw Zodiac in a local theater near where I live in Virginia, at a theater with new equipment, large screen and great sound system. But I noticed that the 1080p trailer that I downloaded and played on my 1900x1200 computer screen at home looked sharper and cleaner. There is a big difference in color accuracy in film referred to as the color space or "color gamut" that LCD's don't measure up to yet, but it will probably get closer over the years.
So with all that said, will my 720p TV still be playing back a satisfactory HD signal in 5 years? 10 years? My best guess is yes and here's why. 1) Noticeable differences, 2) Bandwidth needed, and 3) TV's are turning into computers with multi-sync capability.
1) When I look at a good 720p picture on a 42" LCD, it looks pretty darn good, and actually brighter than a 1080 display since the larger pixels emanate more light, and the smaller pixels in the 1080 do not collectively add to make a brighter picture like the way red green and blue phosphors collectively make different colors as perceived by the eye. Since LCD's clip, or loose definition on whites earlier than other types of displays, the more brightness per pixel the better.
2) There will be only so much bandwidth allowed either for over the air, satellite or internet download used for IPTV available, with all the people out there hungry for content. As it is now, with the best compression technology out there, H.264, it still takes about twice as long as the running time to download a standard definition movie.
Unless there is a major breakthrough, this will not change much since the newest technology compresses twice as much as the previous compression systems and it's only been around about 2 years.
3) All computer monitors these days accept multiple resolutions.
Some large LCD's will handle everything from 800 X 600 to 2560 X 1600 lines. As home video systems turn to central management systems using computers as video servers, the line between TV and Computer with all but disappear. This means that you can change any component in the chain, and not obsolesce another component because they all handle multiple resolutions and formats, 30 frames, 24 frames and 25 frames in Europe. This week, Apple is shipping their bridge unit that connects a computer to a widescreen monitor via WiFi and other manufacturers have theirs out or in the works.
So the bottom line? I will feel perfectly happy with buying a good quality LCD set today and not worrying that it will not give service for many years to come, first in the living room, and maybe in a bedroom as the living room upgrades to larger and sharper as the technology improves. This is a great time for technology to improve without everyone worrying that they will be out of luck because of the next new thing around the corner. Each part, monitor, TiVo or Central control unit, Disc player (Blue-Ray, HD-DVD or Standard DVD), and speaker system can all be upgraded independent of the other.
Oh, I forgot about 3DTV. Forget everything I just said.