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FYI, there is no such thing as "768p"; it is 720p, 1080i, and 1080p.
Anyway the picture quality on a 720p HDTV compared to a 1080p HDTV is not all that different. You can probably see the difference side by side; though if you take a 720p HDTV by itself and play games on it it'll be just fine, IMO. Also keep in mind that a lot of the PS3 games are going to be 720p natively upscaled to 1080p.
If you want a 1080p HDTV, get one that is atleast 40". You will see some 32-36" HDTVs that have 1080p, though you cannot see a difference at all in the PQ (picture quality).
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