Ok, while this sounds good on the surface, it is a double edged sword.
All games can quite easily claim 1080p, but nothing is free. Say goodbye to scene complexity and special effects just to push reasonable framerates at higher resolutions. 720p should be the standard for this Gen. Curse Sony with their lies pushing M$ to compete on this false front.
Remember this "Most games can’t justify running at higher than 1280x720—it would actually make them look worse because of the compromises they will have to make in other areas." from a Ms blog.
Hopefully new 360 with hdmi will have more memory on gpu but highly doubtful.