There's no concrete proof of this here, but I came across an avsforum.com thread here
(starts on page 5)
There is a certain poster here named "darknight" who might actually be some sort of 'behind the scenes' guy (game developer, hardware guy, i dunno) who appears to be legit - and he's saying that the PS3 does have a hardware scaler, but it's just not allowed to be used at the moment, for reasons he did not expound on.
(Well, he did give one reason, and that was that Sony is just plain stupid or something to that effect
I thought it was kind of interesting.
Edit: Nearly 500 posts! This post has been edited by epsilon72: Dec 11 2006, 05:31 AM