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Need help with HDTV formats

Im thinking about buying a HDTV to replace my current non-functional standard TV. I was just confused about a few of the formats.

1)1080i, Im assuming this means 540 lines of a frame every 1/60 of a sec. Do I have to have a special DVD player to produce a 1080i signal?

2)720p. Should I even consider this as an option? I know that DVDs are already 720x480 but I read somewhere that the HDTV standard 720p signal needs a even higher resolution source (HD-DVD?!?!?). Are there any players that can produce a 720p signal from a standard DVD?
 
FWIW, very few sets support 720p natively. Only ABC is broadcasting 720p, all the others doing HD are 1080i.
 
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