Just a note to throw a spanner in the works, I have just purchased a Onkyo 876 with the HQV upscaler to 1080p.
I have tried various options with both my panny Bd30 & sky+hd box, with various connections to see what happens when passing the HD & SD content through the HQV scaler.
(The Onkyo 876, upscales HDMI if you set it too by the way) Sky SD material looks much better, especially with the edge enhancer on the mid setting. block noise is greatly reduced and the overall picture is much better, ITV is even watchable.
Sky HD content unbeliveable looks better, obviously the HQV has more information to work with, but I noticed a big improvement watching Open Season on the HD channel 9amongst other content), especially the edges look much better. And Sport looked smoother, the 46V3000 LCD TV I have is known for some motion blurr on sports & fast moving action, but ran through the HQV scaler it looks much smoother.
I have decided to leave the BD30 on the "through" setting as this looks awesome left alone @ 24fps. However I have connected the component & optical output to the Onkyo 876 as well, and re-assigned another AUX for SD Dvds, as this also looks better than the BD30's 1080P upscale attempt. So the HDMI is free to output HD picture & audio.