this is what i think Apple think about the whole situation. if DVD's playback 480i and there isn't a single Apple device with blue-ray, why bother going to 1080p? It's a 'waste' (in Apple's eyes) since they don't ship a blueray player and those who have bought an external one are so few.
This same kind of thinking could apply to almost every product Apple creates then. No need for faster processors in Macs, since only the minority might actually use them. No need for better graphics cards in Macs, since only the minority of hardest core gamers, etc might actually fully utilize them. No need for various features in iPhones, iPads, and iPods, as only the minority might actually use them, etc.
Justifications of why not to include readily available technologies is trying to justify a poor decision (in 2010) on Apples part if the rumor pans out.
When apple start streaming 1080p, then we'll get it...
Content owners have no reason to even test the potential profitability in 1080p

TV content, until there are 1080p

TVs capable of playing it. What good would it do for- say- Warner or Paramount to insert 1080p movies for

TV TODAY if there are no

TVs through which to play them?
As you can see, this is not a chicken & egg question. Apple must lead by selling the hardware. When there is enough 1080p

TVs in place, some content owner will be tempted to test 1080p content sales & rentals in the iTunes store. If it proves profitable, others will quickly follow.
Otherwise, money to buy a box to hook to the TV keeps flowing toward products like BD players- some of which are incorporating other

TV-like media features- instead of flowing into Apple's pockets. A 1080p-capable competitor gives the content producers another medium through which to test sales of 1080p content, without having to give a cut to Walmart & Best Buy, nor pay for packaging, physical distribution, etc.
Until 1080p

TVs are entrenched, those who want 1080p video for their 1080p HDTVs pretty much have to spend their money on something other than Apple's solution. If Apple (really Jobs) is so anti-BD, the best thing he could do is give the marketplace an alternative option for the masses- a way to get 1080p content on the HDTVs without having to buy a BD player and BD media. Until then, he/Apple cedes maximum quality to the "bag of hurt".
in the meantime, what's the point (apart from those few people who have hd camcorders/BR etc but i am assuming they are a minority?)
The point is that 1080p is the current MAX standard, and the MAX standard readily available in consumer TVs. It's probably as good as it gets for the masses for the next decade or so, until the next standard gains enough traction. When each TV is sold, that 1080p "full HD" pitch is a big piece of the pitch. Even Joe Sixpack can grasp that 1080p is "more" than 720p. When he buys the little boxes to hook to that TV, he probably has enough tech knowledge to seek out 1080p boxes, which is currently BD players, and a few channels on Satt/Cable. A 720p MAX box from Apple falls short of that.
Another point is that there is lots of content available in resolutions above 720p: Quicktime Trailers on Apple's site, Youtube videos, vodcasts, etc. And these exist BEFORE there's a 1080p

TV on which to enjoy them. If Apple leads with the hardware, the number of units sold will be an enticement for much more to offer the option. Else, buyers may seek their 1080p box via added features within BD players, or other dedicated boxes like WD Live and similar.
It doesn't fit in with Apple's methodology of giving us open systems. If you buy content from the store like i hope most of us do, you're not buying 1080p so it's a waste building that into the atv.
It is not an open system when consumers are locked into a single source of delivery for the content. iTunes is great and all- and I myself use it with my

TV, but things would be much more "open" if I could also use content via apps or otherwise from sources like netflix, blockbuster, hulu, etc. Yes, there's some hacks for some of that, but I wouldn't call Apple iTunes an "open" system relative to the

TV.
By not giving 1080p it gives them the platform for them to introduce it to us another year and market/sell even more units...
Yes, but one might argue, we've already done that with the

TV that exists today... and since 2007. It's time for that next system to come out with playback specs better than the one they delivered in 2007.
Would we be so quick to "forgive" them with this kind of justification if they were using 2007 tech in new Macs, iPhones, iPods, iPads, etc?
Besides, I'm sure atv will be hackable and the JB teams will have 1080p shortly after release...
No, if the hardware is too weak for 1080p, it's not likely a hack can make it stronger. Some argue that the current

TV has the hardware to be able to play >720p, but no one has been able to hack it to do so, and still keep the interface, etc that makes it pretty great (otherwise).
If Apple rolls this one out as "720p is good enough" again, they won't get my money (and I'm a huge fan of

TV, owning 2 of them myself).