I am beginning to agree with you.
Today I literally messed with every setting on my TV and it made no difference, however, I did find something out. When I hit info on my TV it displays what the current mode is. When I am in the main roku menus it displays 720p which I believe is by design. I do have the roku set for 1080p output.
I noticed in this thread: http://forums.roku.com/viewtopic.php?f=28&t=36754
That for the USB channel to change to 1080p you need to add "1080p" to the filename. Which got me thinking.
On my apache web server I changed the filename to include that tag and tried again in the roksbox channel. My video had the same issue with the white lines and I checked the resolution on the TV and it only showed 720p!! It isn't changing resolution!
My encoding is sent from the web server as a FULL HD 1080p stream and the roku is sending it to the TV as 720p! I believe that this is where the anomaly is being introduced.
I have concluded that the issue is either with Roksbox not recognizing the 1080p video and prompting the roku to change to 1080p. Or..it could be a roku bug itself. But I am leaning more towards the app not flagging the content as HD.
Obviously there is nothing I can do about this. But I do beg a Roksbox developer or Roku developer to take a look at this.
Please help... Thank you for a great product. This is the only issue I have encountered thus far.
Can anyone suggest a better route of trying to get someones attention?