You can turn this on yourself by editing the PARAM.SFO with an SFO editor and ticking the 720p/1080p box. But at the moment there's still no scaling and before I got the sound sorted out, the performance was kinda so-so. I wonder whether the sound fix will have any beneficial impact on performance now - in terms of stuttering.
If 720p or 1080p resolutions proves to be too slow with libGCM (in the way that it's currently implemented - I'm guessing there is still no proper understanding of libGCM in the community on the level of professional PS3 programmers), may I suggest looking at the PS3 SDK samples and trying the 'Upscaleto1080p' method?
Upscaling from 480p to 1080p and then applying a filter would be good enough - we're dealing with 256x224 / 256x239 resolution-type games here anyway (512x448 on certain games for menu screens like Seiken Densetsu 2/Secret of Mana | Seiken Densetsu 3)