I'm going to be shooting something in high-def that will initially be distributed on DVD, and I've seen a lot of posts about how it's difficult to convert from HD to SD.

My thinking is that it's easier to down-convert 720p because you don't have to de-interlace anything, which is an inexact and lossy process.

So, does 720p convert better to SD, and is the higher resolution of 1080i worth the interlacing?

Here's my 2 cents. The 1080i footage that I've been shooting has down converted to SD DVD really nicely. I don't deinterlace because I never know what type of set-up the customer is playing back on. Also I've read that for DVD playback it's best to keep the video in the same format that it was shot in, so if you shoot interlaced make an interlaced DVD, if you shoot progressive make a progressive DVD. Let the DVD player decide and take care of the playback to the monitor it is hooked up to. Overall the best thing to do is test both formats and pick the one you like the best.