I agree with those above that you should go with the native setting for the TV. I doubt you'll see any difference in the picture quality, but it may process the signal slightly smoother.
As for those talking about having "too big" of a television, well it really does depend on your setup. I'm one of those people with a huge living room and I have a 50" Samsung (PN50A550). It's actually a little undersized for the room it's in, but my 360 looks stunning on it. I would highly reccommend it to anyone looking for a new HDTV.
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