Tony, I realize it does do a bypass, but it does not have a function where for DVD's it automatically outputs 480i and the native resolution of BD. I researched this matter for sometime prior to posting that as I thought it offered it.
Here is a post from Chris Boylan of Big Picture Big Sound
"There is no "source direct" function on the Panasonic players so there is no one setting to let your TV do the de-interlacing and upconverting.
For Blu-rays, you can set the BD60 or BD80 to 1080i resolution and enable 24p output. This will send 1080i/60 discs to your TV at 1080i/60 and will send 1080p discs to your TV at 1080p/24. This will allow your TV to do the HD de-interlacing on those few 1080i/60 blu-ray titles, if you think it does a better job than the player.
For DVDs, you could use the component outputs. If HDMI and component are both active, then component automatically gets 480i output. Then select the component input on your TV for watching DVDs. The only drawback to this is that Panasonic's video processing engine does the de-interlacing on DVDs first, before any other processing, and this is actually not defeatable. When you use the 480i component video output, you are actually getting a de-interlaced/re-interlaced video signal. Panasonic says this process is transparent. I haven't really tested that to see whether it is.
Some Pioneer players have a source direct feature that passes the signal to a display or processor in its native resolution. But the Pioneer players a.) are really slow; b.) offer no streaming capabilities and c.) are more expensive than the Panasonics.
The upconversion and de-interlacing on the Panasonic players is quite good so with 1080p HDMI output and 24 FPS mode enabled on the player for DVDs, I think you'll get great results on your TV. "