The question you're asking is actually "is the scaling chip in the upconverting dvd player I'm considering buying better than the scaling chip in my tv"? Of course, when asked this way, it becomes a more dificult question to answer that depends on both the DVD player and the display device. The other lesser issue is digital vs analog transmission of the signal, which isn't nearly as important as most people think. (Now, on the other hand, for computer displays I'm a huge fan of DVI, and always point out the little crawlies to non interested bystanders when stuck at an analog lcd)
From personal experience, the converter in my samsung HD850 (model number from memory) is leaps and bounds above the converter in my 24" dell monitor. The 850 has the added benefit of being a few remote presses away from turning off hdcp and outputting HD on the component outputs.
Matthew