#2 - The edge puts out up to 1080p, PS3 only does 720p.
Bullshit. There are several Ps3 games that go up to 1080p, and the ps3 outputs 1080p just fine when in the menus or watching blu rays.
My Genesis via that scart to component transcoder looks quite nice on my HDTV. Probably a bit better than my SNES even, very crisp. No issues whatsoever on my TV with a 240p signal. Besides, those scart cables and the transcoder could be used in conjunction later with a DVDO Edge to get an even
nicer image. Hardly a waste in the long run.
If you want a CRT, hit up garage sales or pawn shops. $20-50 should get you something pretty nice and they'll probably even be willing to knock the price down for you. I wouldn't even bother trying to find a new CRT, especially if your plan is to replace it down the road.