Can someone please enlighten me..

I have a Sony SXRD, with a native resolution of 1080P. Is it true that, regardless of the original resolution, the TV always upconverts and displays 1080P? Or will it display 480 as 480, 720 as 720, etc?

If it does always upconvert to 1080P, then I assume the role of an upconverting DVD player is to do a better job of upconverting so that the sony doesn't have to.

If it does not always upconvert, then I can understand the idea the DVD player.

The reason I'm asking is because my parents are moving into a house that came with a Sharp Projector from 5 years ago or so - native resolution of 720. They have a few 'budget' upconverting DVD players (sub $150), and an Xbox360, and I'm curious if it is worth it to get a 'better' player.

Thanks