I know of the standalone dvd players that can up convert to 1080i, but are there any pc apps that can do the equivalent. At the moment I have my pc connected to my HDTV set and I can watch movies, but not at 1080i.
There's an excellent article at htpcnews.com that's updated from time to time on this. Link: Wait for a minute after the page is loaded, then mouse-over any of the images for a before-after comparison... quite impressive! Basically, the approach is to use a post-processor such as ffdshow to resize, sharpen, and de-noise the image. The article shows you how to set up ffdshow for up-conversion, and also shows you how to set various media players to use ffdshow for processing. Also, keep in mind that the cables you use have an impact on what you see on your tv (assuming you're not watching on your pc monitor)... S-Video, for example, limits the resolution to 480p - effectively killing all the post-processing you've done. I used S-Video for a while on my Panasonic tuner; then I realized there was an input for my monitor-out!! The difference was jaw-dropping. Now I'm finally watching HD on my HD screen!