HD TV - any difference?

[jlspec]

...I was about to type all of that...

And this:

I also have a 32" LCD HDTV ... I think it just hates interlaced. =\
Is it possible for a television to upconvert to progressive scan because its native resolution is 1366x768p?
...That would destroy an interlaced image, right?

Your LCD HDTV will convert the 480i image to it's native resolution of 1366x768. Component cables either for a PS2 (Some games only, while providing better color for 480i) or Wii (almost all games with 480p support) will make a big difference in color and resolution. Just think about it for a moment, 480i = max 30 FPS + 240 lines of resolution and 480p = max 60 FPS + 480 lines.

If you can't notice a difference when using Component, then you might want to invest in a better HDTV. Not all HDTV are equal in picture quality.