FWIW I bought
this Toshiba 42" LCD from Amazon.com and I'm very happy with it so far. (I also paid $1600 about 3 months ago, down to $1299 now).
I'd definitely go with 1080p if you're getting a screen 42" or larger. It might not make a huge difference with HD channels (most max out at 1080i anyway), but eventually you may want to buy a HD-DVD or Blueray player, and you'll want the 1080p to see HD movies in the best possible quality.