nfaguys, I'm not sure if they've announced a model number for the 971's replacement yet. I've traded a couple e-mails with them after lurking around in some AVS threads, and it sounds like the replacement won't be out until August or so (at least that's what some of the 970 beta testers at AVS are guessing). It will retain the Faroudja, I believe, but will use HDMI instead of DVI and will add SACD as well as the analog refinements that the 970 has.

RCF051, my 971 has been free of macroblocking on my display, but like you I've got a direct-view CRT display (32" Zenith/LG HDTV with DVI input) - I haven't seen it paired up with a DLP display.