An HTC representative has said that the Desire can record video at 720p in a video recorded at the Mobile World Congress.
Now, whether the phone actually ships with the software to record in 720p is another question. Other reports have suggested recording resolutions of WVGA (800×480) but if the hardware can support it then the software will surely follow in a future firmware update.
Start watching from about 3:10 for the HTC Desire talk.
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