I have a 40" 1080p LCD at ~6-10 feet. I configured the desktop in WinXP to use large fonts. I routinely zoom my browser and document windows to make reading text easier. But there is the occasional application that over-rides these settings, leaving the text uncomfortably small.
Windows 7 seems to have much more consistent support across applications for setting font sizes.
Thanks all, for the additional comments. Seems like 1080p is nice for a monitor, IF you have good enough vision. I wish there were some way I could test out everything without having to actually purchase a TV (and then return it if necessary).
I have a 40inch 1080p TV which I (occassionally) use as my computer display. If anything, I wish I had _more_ resolution not less hence I recommend that you go for 1080p. Realize that 1080p on 40 inches (diagonal) is only 55dpi whereas most computer monitors or laptop screens are 100-120dpi. So, with the pixels being bigger on the TV I see a lot of jagged edges around fonts, etc.
High def for movies is one thing, for computer work is another.
dpi is not the whole story. Where you typically sit is of utmost importance.
I can tell you 1080p is counter-productive for PC chore in a 37" to 52" HDTVs where I typically sit no closer than 5ft. I display my 1024x768 LG plasma using 1360x768 and from 5 ft, it is perfect and I can't imagine reading smaller text. Less real estate is better than squinting for me. (Your guess is right - I use Window XP)
I may end up replacing it with a LCD because it is on 2nd floor. I probably will get 1080p but I can tell you I will most likely dual it with a monitor and not bother with using the TV as a monitor then.