Two quick articles with a lot of information. The first one states that both of the Toshiba HD-DVD players output their signal at 1080i, but it also goes on to explain that Blu-Ray will only be 1080p.

However, it seems certain now that some HD DVD player owners will have 1080p movies in their repertoire, which their players downgrade to 1080i, only to have the images reassembled by their digital displays into 1080p again. Both players and movies for Blu-ray - whose dual-layer format has a 50 GB capacity - are currently slated to support only 1080p resolution

Point Blu-Ray.

The second article is on how HDCP is a boondoggle to consumers and the MPAA is just laughing all the way to the bank. Let me explain. Even with HDCP cracked, High definition hardware must still support HDCP and pay royalties to use it. China, Korea, and anyone else must also bow to the HDCP god and pay if they want to ship to the US.

With the MPAA adding an encryption scheme (no matter how weak), they now have precedence to sue anyone and everyone under the DMCA if they in any way try to circumvent their “scheme”. Let us hear from my new “buddy” Ed Felton:

A much more plausible answer is that HDCP encryption exists only as a hook on which to hang lawsuits. For example, if somebody makes unlicensed displays or format converters, copyright owners could try to sue them under the DMCA for circumventing the encryption. (Also, converter box vendors who accepted HDCP’s license terms might sue vendors who didn’t accept those terms.) The price of enabling these lawsuits is to add the cost of 10,000 gates to every high-def TV or video source, and to add another way in which high-def video devices can be incompatible.

Warner, Universal experiment with HD DVD format variations in new releases
HDTV and HD-DVD encryption not intended for security - Homeland Security or Homeland Stupidity
Freedom to Tinker
Ed Felton’s beginning series about HDCP. Read all three!
EFF blog on why hollywood want HDCP broke