720p is 1280 x 720. 1024 x 768 is a non-HD resolution.
All receivers can support HD resolutions. If for example, you are using component video cables from a cable box to the receiver and the cable box outputs 1080i, the receiver will pass it untouched to the TV.
What you are talking about when you say the receiver 'only supports 480p' is deinterlacing (converting from interlaced to progressive scan). That is a truly worthless feature as the dvd player itself can deinterlace the 480i on the dvd to 480p.
If the dvd player scales 480i or 480p to 720p, the receiver will just pass it along. But as I said before, if your TV's resolution is really 1024 x 768, the TV will turn around and scale the 720p down ('decimate') to 1024 x 768, so why bother with scaling in the dvd player?