wow.
Ok, so you need an HDTV to make HD media look, well, HD. SD has only so many pixels to display. So, you need an HDTV that supports 1080i (which is 720p) or 1080p. I assume you mean SD when you say analog. Analog and digital just are the types of tuners a tv has.
Finally, a DVD player will not play HD media. Your 360 will. It needs to be a .avi, .wmv, or .mp4. You can put it on a DVD, a flash drive, or stream it directly from your hard drive.