Well, I could guess that it would indeed look worse. Why would you output 1080i from an HTPC for DVD playback? Set the output for the HTPC to 1440x960 at 72 Hz for film source and 60 Hz for video source. 1080i will introduce scaling artifacts that will greatly outweight the 1080i resolution increase. 1440x960 will be exactly double the verticle and horizontal pixel resolution, thus not suffering from the scaling artifacts of having to multiply by a fraction.
HTPC should be set to that resolution for CRT if it can handle the bandwidth. On a fixed pixel display, it should be set to the native resolution of the projector. When these settings are followed, the differences are not subtle.
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