This is correct, HBO is also 720p. I prefer the 720p programing personally. Interlacing should have been dead with the switch to HD.
I second that. I think 1080 is only necessary if your display is over 100 inches.
I'll take 720p any day over 1080i, but you can't convince me that 720p looks as good as 1080p on a screen of any size. If you look at a two 50" screens side-by-side, one 720p and one 1080p, the difference (detail) is significant, assuming you're using a true HD source.