Yes, unfortunately, you are correct. I don't know of any devices that will take a HDCP enabled HDMI output and transcode (downconvert) it to Component or VGA. What kind of TV is it by the way? Others on the board may have more knowledge about this than I.
Oppo 970's and possibly 980's can be hacked to upscale over component, and there are some older DVD players that can do this (Zenith used to make one). Whether or not this is worth the price is up to you. Upscaled DVD's may look better than 480i/p players, but it's not a night and day difference like going from SDTV to HDTV or anything.
As an aside, I don't suppose you have an XBOX 360 do you? It will upscale DVD's to any resolution up to 1080p using VGA.