HD isn't as important as good audio. A wide angle lens is very useful too. I've got both and love HD, but not too many people can burn to Blue Ray or even have a HD television. You can get a good used Sony or Canon miniDV with a shotgun mic on eBay for $300-$400. I have a couple Sony HC-90's and really like them. They can shoot in 4x3 or 16x9.
As for viewing on your 42" LCD, you should have different zoom options on the tv itself. I assume your 42" is a 16x9 widescreen format.