Hi fellow Singaporean. Yes I think the iPhone 5 will not be able to project the full 720p resolution. But rest assure the quality will not be compromised, movies still look very sharp & detailed, if that is your concern.
The 1280 x 720 image will be down sampled to 1136 x 640. You won't lose any of the image, it just won't be in full rez. With that said, you are talking about a 4" screen so the loss of resolution won't be noticed. Unlike a television where the pixels are huge, a phone is tiny and will still look hi-def.
If you really want to get into it, it isn't "80" pixels, it is technically a loss of almost 200,000 pixels, but either way the video will still be stunning on a 4" screen.