LG 32LC7D hdmi and xbox 360 problem

I just bought an LG 32LC7D a week ago and my xbox 360 has an hdmi port and everything goes fine until i try to play a dvd or any copyrighted downloads from live marketplace. The screen will go blank and no sound. eventually i found that changing input and coming back and i'd get 'HDCP link restored' on screen and find the show had been playing for some time already. Oddly i found it only has this problem when i run the xbox in 720p or higher.. 480p doesn't have this problem, but it's a pain to switch back and forth.

i have also taken my xbox 360 to the dealer where i got my tv to try their disply model tv and it has the same problem, and tried the x360 on another tv i had been interested in the LG 32LB4D, and dvd playback worked fine in 720p.

i'm wondering if anyone else has encountered this issue, or any idea what can be done. Hoping it wouldn't be a problem with connectivity to other things such as ps3 or dvd players (don't own either yet)
I've thought about exchanging my tv for the LB4D model, except i noticed that it seems to make xbox look like crap, especially in dynamic picture mode. it seems to make areas look dithered. I didn't have much time to play with color settings, but default it doesn't look near as beautiful as the 32lc7d

also my LG 32lc7d is october 2007 manufacture date

doesn't appear to help for playing dvd's from the xbox.
i will note that hdmi input from someone else's dvd player seemed to work fine thru hdmi when i tried that the other day, but i'm sure it only ran 480p mode. which the tv never had a problem with.

when playing video from xbox over component cables it'll shift from 720p down to 480p and i have to use the tv to stretch the video. when running over hdmi from the dashboard at 720p and into dvd i believe it stays in 720p, no stretching needed when i change input to tv and back to hdmi (how i get it to ever work)

hrm looks like my firmware is current..
welp i may take this one back after playing with color settings on the other set to make sure i'd be happy with how it looks

interesting to find this set looks like it's running linux, that explains a few things, like why it takes a few seconds to turn it on

while we're discussing LG, does anyone feel that LG has more input lag than others? do any other brands handle input lag faster (without game mode)?
i've had some ppl (namely walmart employees) saying LG makes the worst sets

i have noticed a difference, it seems harder to play games like call of duty 4 making a transition to lcd from a crt

and has any other LG users with my model noticed the same problems with hdmi?

ok.. so using 120hz mode on the lb4d series would actually cause more problems with display/input lag playing fast shooters?

am i better off keeping the 32LC7D, or is LB4D somehow better all around?

k, well which series is technically newer? LB4D, LB9D, or LC7D? to me it seems lb4d and lb9d would be older by the lettering and number.
but it may not be the case. i think i've seen somewhere that lc7d only has 1.2a hdmi and lb4d and lb9d are 1.3a

yah, my tv only has a 'set by program' mode.. it's as close as i can get it to 'just scan' that i've seen.. thought all LG's have that mode, don't think i've seen any with a just scan actually... thinking of going back to the dealer to possibly exchange my tv, and actually use my xbox in 480i mode thru classic video input to check the lag and see if there is a way to get the image on any sets to not interpolate to take up the full height of the screen.
one cool features this tv does have is video out (not lagged either).. so i can connect another tv to see if it's faster/slower than what i already have. that's how i was able to really see how bad input lag was at first when i set a normal tv beside the lcd and played a game.. a video splitter would do the same but i'd probably irritate the saleman hooking up several tv's to the older composites

i just don't think i want anything larger than a 32" tho, don't really have the space for anything larger as it's in my kinda cramped bedroom

i just took my xbox360 into a tv store and ran it in 480i mode and video split to test which tv's do better (the LG 32lc7d has a video out so comparing to it makes it easy)
my finding is that LG lcd's, inlcuding their plasma models have very bad lag compared to the rest, i was able to test a hitachi 50 inch plasma, LG 50 inch plasma, LG 32lc7d, LG 32lb4d, toshiba regza 32" lcd 67u series, and sony 32" lcd s3000.

i ran call of duty 4 to compare by aiming at objects like a car and quickly trying to aim and shoot at something else several feet away and quickly back again. the slower tv's it's very hard to do and comparing side by side you can very easily see the differences. also note i hold my own with this game, with a lagless* crt tv i have very quick aim and don't miss or overshoot and can get into top 3 in any online game mode with experienced players, once i'm warmed up. a tv with a lot of lag however, will send me to the bottom everytime with maybe one kill

the 2 plasma's i wasn't able to video split, but trying them felt about as sloppy as my own LG 32lc7d. the 32lb4d diddn't seem to do any better, i forgot to turn off trumotion for the test, but it looked like it was a frame faster. the sony and the toshiba were way faster than the LG. nothing was run in a just scan mode. to my knowledge you can't even run 'just scan' in 480i over rca composite

monday i'll be taking my tv back and i may try testing the toshiba to the sony if i can get a hold of a real video splitter.. i'm planning to buy one of those 2 now. reason i care, is i'd like to play ps2 games, and plenty of other older systems with as little lag as possible. and trying to play something like baseball on my LG it is very hard to do, very noticable in a homerun showdown, instead of homeruns to deep left centerfield i hit foul balls to right side or strikes