I have the same projector and am using a BDP83 to project beautiful 720p movies onto a Elite 106" screen. There is no comparison between an upsampled DVD to a Blue ray (BR being vastly superior)and if you have a BR disc with true HD or DTS even the sound of regular DD or DTS is inferior. I thought about upgrading to a PTAE4000, which I can get from US for $2k but I have only 900 hrs on my bulb and so I have decided to wait another year by which time there will be a new model out and hopefully wider availability of BD discs in India for lower prices.
Also I did a comparison with full 1080p resolution on my friend's 4000 in the US - he used to have the 900 as well , and though it is better than a 720p image it is not glaringly so and in many cases I had to look for improvement. This is actually based on viewing distance, and the closer you are to the screen the better resolution 1080p will have compared to 720p, but IMO if you are apprx. 15' away from an apprx. 100" screen then it wont be a huge difference.
Anyways just my humble opinion - I am just a novice user - compared to the many advanced/senior users on the forum.
Cheers
Sid