A display of that resolution is infeasible with current GPUs, though. The device would be a combination of too large, too heavy, and/or have too short battery life. I don't even think it will be feasible in the next iteration; perhaps the one after.

I honestly think they made the resolution only 1024x768 on purpose to reduce the amount of time it will take to be able to cost-effectively double it. If they had shipped with a 1280x800 screen (like the Xoom's) off the bat, it would probably tack on an extra iteration before they could double it.