Typically people upconvert composite or s-video connections on an AVR to allow those older sources to input to TV at HDMI/DVI.

Upscaling is typically used to convert older 480i/480p sources to a 1080i/1080p capable TV.

Most current HD TVs will upscale internally all sources to it's highest output anyhow.

Granted, I could be completely wrong here but this is what I've learned over the past year or so.

My Home Theater