I did notice there was a difference in PQ when using component vs HDMI running from my XA2 to my TV, the XA2 still showed outputting 1080i, but my TV doesn't show what resoluting it's displaying so it could have very well been 480i through component. My XA2 will only output 1080p through HDMI.
Another question would be if the HD DVD was connected to the receiver via HDMI then component was run from the Receiver to the TV would the receiver take care of the HDCP issues enabling the component to carry HD back to the TV.
As a side note my old XBOX 360 add on HD player used component cables and was able to deliver a 720p picture through component.
