I would definately shop around as 1080p HD TV's are dropping in price all the time. I recently saw a 40" Samsung for under £500 in a supermarket so I would imagine looking around online would be cheaper.
It depends on your budget I guess but I would go for a 1080p if you intend to keep it a while.
Also, blu ray players are well under £100 already and that would show off your 1080p TV no end
