How does a 1280 x 1080 tv display 1920 x 1080 content? Does a PS3 have a problem with this resolution?

In this case I'm talking a plasma display, so interlaced or progressive is irrelevant. Many plasma displays are at a res of 1280 x 1080 which is not technically a widescreen aspect ratio. I'm wondering if that causes any problems, or how a blu ray movie that's TRULY encoded at 1920 will render on such a display. Anyone with experiences or advice? thanks.