I think that format is converted many times between stations but bandwidth (usable information) stays the same. 720p should be better on the standard TV since human eye is very sensitive to horizontal misalignment that comes from interlacing but in digital TV everything is converted to individually addressed pixels anyway. I have 42" DLP TV and switched mode from 1080i to 720p many times - could not see absolutely any difference. I don't know why many stations transmit in 1080i since, according to my friend who knows more about image processing, 720p is easier to compress.
