The 360 is the one that is dvd friendly with the newer format there. That's why people went crazy trying to be first in line when that first came out. The original X-Box screen is far from pc friendly and what you are trying to do there. That's why I suggested shopping around to see if you can find the 360's screen for less elsewhere.
$56.99 at http://cgi.ebay.com/NEW-INTEC-G8270...ryZ20385QQssPageNameZWDVWQQrdZ1QQcmdZViewItem
The main description that shows the differences between the 360 and the original should be reviewed at http://en.wikipedia.org/wiki/Xbox_360
THAT is my problem. 5.6" would be pretty pixelated wouldn't it? Or would the new format help it an bit?