sigh.... you are splitting hairs about 1080i vs 720p
the original question...
If I set the settopbox to output 720p over HDMI will the receiver recognize, that some channels are in 480p and upscale them? Or will it act as its receiving 720p allways?
... was about setting your cable box to one fixed rez output, 720p. he could have just as easily said "1080i".
The point is, he wanted to use the Denon's scaler to scale STANDARD DEF signals from his cable box, and the answer was to not set the cable box to fixed output, but rather to let it pass the native rez through. how would the Denon "know" when it receives a 720p signal that the channel was originally an SD channel, and not just a 720p signal?
Perhaps the PReP function (although I admittedly don't understand it completely) would recognize that it was originally an interlaced signal, and re-do the deinterlace part, but it's not going to take a 720p input and take it back to 480i, right?