This is not a definitive answer, but my opinion. The upscaling feature in mid to upper mid (and some upper end) receivers is implemented as an afterthought. So there is no contest there. Barring exceptions, the player will be better. I think unless you look into the ultra range of processors (like Anthem Statement D2), the player will do a better job.
I think I know where you come from on this. If a $200.00 DVD player like Oppo can implement a decent upscaling solution, why are receivers costing $1000.00 and more, doing such a poor job of it.