I can see the difference between an xbox 360 on an SDTV and a HDTV really easy, make sure you got the HD turned on in the 360's settings, that or your blind!!!
on DVD vs bluray, I can still see the difference, but it's only a tiny bit sharper, unless you got a big explosion with tons of glass flying around, then it's like wow, other wise it's doesn't look worth the extra money to me