As others have said, all else being equal, I doubt you'll be able to see an actual difference at 10' between a 720p and 1080p television; any picture differences will be more a function of panel quality (contrast, dynamic range, color fidelity, viewing angle, etc.), backlighting, and refresh rate than resolution.
Best Buy has a bunch of 26" flat panels, but only one (the Sharp LC-26SV490U) is 1080P . . . and it's only got a 60 Hz refresh rate, which I personally don't find acceptable.
As long as I wasn't planning to use it as a computer monitor, in this size class I'd be more inclined to look for a 720p set with 1) 120 HZ refresh rate; 2) matte finish on screen; 3) decent sound quality.
Also a narrow bezel . . . they vary a bit, so take along a tape measure.