If you want to display 720p content in a 1280x720 'window', you are barking up the wrong tree. That would be a TV option. The PS3 is only the output device. It is the TV that decides how to display it. If you want this option, you'll need to contact the TV manufacturer.
My cable box has display options, select letterbox and lower resolution content is displayed at native res on screen with black borders.
The PS3 when displaying DVD's allows you to select full screen or double resolution, etc. This means you can have close to native res on screen with black borders.
The PS3 when displaying PS1 or PS2 games allows you to select similar full screen or letter boxed options. This means you can get closer to native res with black borders.
The PS3 when displaying video content from a streaming source such as a home network allows you to select the viewing mode whether full screen or letterboxed. This means you can have native res with black borders.
The PS3 under video options allows you to select a few options one of which refers to 720p bluray movies, stating if you select double res it will be displayed in full screen on a 1080p tv. This make me think(As I have never seen a 720p Bluray) that if you had a 720P bluray and chose the right option you would see it displayed at native res with black borders.
In short the PS3 is the right tree to bark up in this case, why Sony did not allow this option only for games must have been due to a performance worst case scenerio they must have envisioned, or something similar.
You're also forgetting about the all important ASPECT RATIO which also plays a factor in the black borders being displayed.
I have a satellite box and a TV in my living room that do similar things by changing the aspect ratio and making the image fill the screen and such, but realistically, what they only do, it either zoom in the picture, or zoom-out.... and when having the box and tv set to do two different things, you're essentially either not doing anything to the picture, or making it all sorts of out of whack.
The PS3 can do something similar with both retail DVD/BD's and the same movies being played off of the HDD or from a media server. The PS3 will change the aspect ratio and zoom in or out the image based on your settings, the same settings most TV's use.
Yes, there DO EXIST TV's that will show a border around a smaller resolution image like the OP is looking for....
I have an Insignia TV that I mostly play games on, because my 65" has ridiculous input lag even with game mode on or motion processing turned off.
I'll try and play with my PS1 and PS2 games on both my B/C PS3 and Super Slim PS3 and see if I can't get do some settings to try and get a border all the way around.... I might even try low resolution video material.
But first..... charge my camera
Numbers don't mean much, because you're talking about the "bigger picture", literally.
You're still talking about a PERCEPTION of difference.
My motivation for proposing this option is what I see with my eyes. I only stated the numbers for information and for backing up my experience.