Okay, not sure how many posts happenned with my name in them without me responding.
I have been on the high end side of things as a Crestron programmer for about half a dozen years now and because it is not just high-end, but is consistently VERY high end, I have had the chance to review some fun toys.... err.. work with some serious products.
Every fixed pixel display: IE, plasma, LCD, lcos, dlp, etc., etc. has a certain number of pixels. Let's say it is 1280 pixels wide by 720 pixels tall. If you feed that display a 480i signal, then the 480i is converted to 1280 x 720. This already occurs inside of every fixed pixel display on the market.
There is a lot of math and algorythms that the video signal runs through to take it from 480i to 1280x720 - and they need to happen instantaneously to keep in synch with the audio (doesn't always happen that way though).
The ability for the processor inside your $1,500.00 LCD or $6,000.00 plasma to convert different video formats to the native rate of the display is a part of what you are paying into. The better displays use better processors which utilize thousands of hours of design/engineering/testing work to change video from one format to another while (most of all!) preserving quality.
Is there any doubt, or question that one company is better than another? I have put my hands on products from DVDO and Faroudja and have flipped the settings when hooked up to a Sim2, Runco, and other projectors as well as plasma displays and even more typical CRT rear projection TVs and have seen what happens when image correction filters are turned on.
In about 80% of the tests, the image was improved. Not ONE test showed the image to look worse! It wasn't scientific testing, but was informal product review and analysis for whether our store chain might pick up the product.
Would I go for one integrated into an A/V receiver? Meh, only if I were looking at really nice ($$$) A/V receivers and had the money to spend. On a budget I would likely get a Denon AVR-2805 and hook it to a DVDO if I wanted to reach a nice price point or I would just use the scaler that is already inside of my display.
The food reference is good - I would say that the burrito reference is especially good... You see, if you put a burrito on a plate, it's just a burrito. If you put it on fine china (component) and decorate it with garnishes, it's STILL just a burrito. But, if you give it to a chef and he adds some spices and sausces and dressing, it is a much different flavor burrito than before and it will truly taste better to most people. It will be a better burrito - to most people. Not all people though, some won't like the added flavor and some may not be able to tolerate it at all. That would be a good reference for video scalers which most TVs will appreciate and provide a better image with. Some, a very few, won't.