The idea is that on Bluray, you can store everything in its native format, so if you can display it natively, you may. If not, than your player will do the appropriate scaling/interlacing/pulldown to make it work on your display. Where as on HD-DVD, there is no option, and content wont be stored in its native format even if the display is perfectly capable of utilizing it, it has not the choice.
What an oversight. Also, it will mean bluray will be able to make fewer discs, since the difference from region to region will be minimal, if there is at all. With the word that some studios may forego region coding, atleast at first, there could be releases of global discs, which cuts costs and allows everyone on earth to have the same viewing experience. Im glad I live in the US, 4% speedup seems absolutely intolerable.
CROPPED < OAR < OPEN MATTE -- OOOOH I SAID IT!