720p video on N900 is too much for DSP (yes, it is accelerated). why the f**k would You want it anyway, when You got 800x480 screen? Just use 480 resolution, and You'll have native resolution video - *much* smoother than 720p or even 1080p, due to downscaling |(which always lose a bit of quality).

Simply put - the best possible quality, is when You use 480p video. If You use TV-Out, it's affected by PAl/NTSC (preferably PAL, as it have slightly higher number of lines) conversion + overscan, so quality is f***ed anyway 0 using Tv-Out, it matters even less (so, 480 still is best choice).

Hope it helps in understanding how this video stuff works...

/Estel