37" inch is a good size for an 1080p TV especially for people with small apartments.
Now 32" 1080p is a bit of an overkill as you would almost need to be using it as an PC monitor to notice the difference, but then again many people do use 32" 1080p sets for PC displays. A 32" 1080p set is good for editors and colorists, since they would be sitting very close anyways.
And no a very good 720p doesn't look better than an equally good 1080p TV, that's utter nonsense. Contrast, color gamut, motion artifacting, motion blur, viewing angle have nothing to do with resolution. These are all factors that are derived from the display itself, resolution is resolution, just that and nothing more. Yes it's true that a poor 1080p TV is no better than a great 720p set, but that doesn't mean you should discount 1080 all together.
In fact I will go as far to that 1080p isn't even enough. Most displays used for advanced color timing, and post production are now hovering in the 2-4K range, in fact most studios are now digitalling mastering their old film catalogues at 8K resolution. They are now seeing things that they have never seen before on some of those old 35mm and 70mm films.
In the world of resolution, higher is always better. Because the human eye is an biological receptor, it doesn't see in digital threshholds. When you open your window and look into the real world, I can assure it is far higher than 1080p, even 8K digital imaging cannot capture all that the human eye can see.
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