If you want to see the difference that 1080p makes in gaming, download the NBA Homecourt demo (I don't like the game, but the graphics are second to none... native 1080p!) from the Marketplace. Connect your 360 to your HDTV via component and set it to 720p, or 1080i and play the game for a while. Take note of the jaggies on objects in the game, particularly player's legs at angles with the game frozen.
Now connect it with your HDMI cable on your Elite or HDMI equipped Premium (I can only use HDMI in my experiment because that's the only way my HDTV can display 1080p) and set the display in your Dashboard system display to 1080p. If you don't see the improved sharpness and amelioration of jaggies in this test, you don't need to consider supporting 1080p. It didn't take any imagination for me to see the difference, but I sit at 7 to 9 feet from my 56" JVC 56FC97 for gaming. Starting at 11', I can't tell you whether I'm looking at 1080p,1080i, or 720p.
It was worth it for me because I know that many games will support native 1080p in the future. But your mileage may vary. I would definitely try to go somewhere that you can conduct this test for yourself.