Angry owners in the AVS forum report that the Fall Update's vaunted 1080p support works as advertised with Samsung HDTVs -- but not with two of Sony's most popular (and expensive) 1080p LCD models XBR2/3:
Feh. Since the XBR2 is one of the most high-profile, wildely available 1080p displays on the market, you'd think MS' engineers would find a way to get the two to work together, but noooooo...
While it's outrageous to suggest that MS would intentionally blacklist their rival's most popular HDTVs, it is amusingly ironic -- unless you're staring at a $4000 distorted screen right now. Another patch could be imminent. It's worth pointing out that most people on that thread say they're going to return their Sony set, not their Xbox 360. And, as usual, someone comments that an upscaled 1080i signal is indiscernible anyway.
Sidenote: The general public doesn't have a prayer of grasping this stuff.