I sit like 1 foot away from a native 1280 x 720 17in screen using and HDMI to DVI-D connection from my PS3 and Xbox 360. I almost notice everything. As for compression, I meant lossless compression, if they can compress it with no artifacts I'm all for, I don't mind compression in films/ movies/ blu-ray, just pre-rendered game cutscenes bugs me because it's inconsistent. I'm not in the movie industry I'm an audiophile and videophile though
Sounds like you are shooting for the holy grail.
I don´t think lossless video compression is used commercialy anywhere. And if there is some loss there per definition are artefacts present. If these artefacts are always perceptable to the human eyes, hmm yeah I guess there is where the videophile parameter kicks in.