A standard definition TV will not accept anything higher than 480i. I was under the impression that the 990's component output for transcoded video sources (s-video and composite video) was 480i. Have you tried the DVD player set to interlaced and connected directly to the TV? There may be an issue at the TV that's preventing it from using the component input at all (or the initial 480p signal confused it somehow).

Standard definition is finally approaching the end of its life span. If you are going to buy a TV today and it's going to be bigger than about 20" or so, I'd be hard pressed to recommend buying one that wasn't HD capable - and that goes double if the TV will be in the home theater setup.