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Can someone please describe to me how a 4:3 HD television displays a HD 16:9 signal? I understand that the image is usually letterboxed. Does this letterboxing lower the effective vertical resolution of the image? In other words, given a 4:3 HDtv with a 1080i native resolution, are those 1080 vertical lines used to draw the letterboxes, thus lowering the number of lines left over for the actual image? Or is a 4:3 HDtv capable of displaying the full-resolution 16:9 image in a letterbox format?
 

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This is what 16:9 vertical compression is for. There are some quirky older models that don't do this, or don't do this for 480p input, etc., but basically any 4:3 HD-ready set you'd buy new today will definitely give you full resolution with 16:9 DVD or HD material.
 
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