I think the main difference between HD ready and full HD is that HD ready is 720p, whereas 1080p is full HD. Currently, I think that “HD” TV broadcasts are only up to 720p, so they’d be near identical on both systems
All the TV broadcasts I’m aware of are 1080i 50 hz – ie half the lines sent 25 times each second. At 40″ you may as well go for full-HD now.
Personally I still think Plasma gives better and more natural images and viewing angles but there’s not much in it. That LG must have been seriously mistreated – I can only think it ran in the shop, at full brightness, on a single channel for a long time. You’re unlikely to do that in your own home.
Whatever you buy, pretty universal advice is to disable every form of picture ‘enhancement’ the set has (noise reduction/higher scan rates/etc etc) and don’t use it on the ‘vivid’ picture setting that they’re normally set on by default to appear bright under shop lights. Usually best to set to ‘movie’ and tweak a little from there to get the most natural colours. It will look a little dull at first after the hyper bright default setting.
The BBC HD channel runs a testcard and other tools as part of the barker that runs during the day.