I have a 720p Capable TV, but the PS3 forces 480p?

I have a Dynex DX-L26-10A television set, an HDMI cable, and a new 160GB PS3. The television set supports 720p (not 1080)... I'm not sure how to get the PS3 to recognize that. When I use the checkbox in display settings to select 720p as one that my television supports, it goes to a black screen then a brief static interlude, black screen, static interlude, etc. for a few times before the 30 second timer is up and it forces it back to 480p. Is there any way to get the PS3 correctly set to 720p or am I stuck with 480p? I just really don't understand why it won't take the 720p. Thanks in advance for any/all help. Just don't suggest I get an XBOX or something ridiculously unsolicited like I've seen on other questions, unless you enjoy getting thumbs down for your answers.