My suggestion in order of importance depending on how much money you have to spend:
1. Larger screen to 42"
2. 1080p
3. 120hz
LCD TV's are great for watching movies, OK for gaming, Horrible for text work.
It really doesn't matter which type you buy. TV's don't compare favorably to Computer monitors due to pixel pitch and response time.
There's a good reason why a 30" Monitor costs more than a 32"tv.
120hz or 1080p marketing wont fix it.
In fact I would bet at 32" you would be hard pressed to tell the difference from 8ft away playing wow.
I have a nice 42" 1080p TV that I use as a backup monitor for one of my multiboxing alts, but I couldn't imagine trying to do any text work on it or trying to play with it on my Main (Currently using a 24" 1920x1280 monitor)
I have seen 32" at 720p and 1080p used as computer monitors and personally couldn't see much difference. Both had Blocky ugly text IMO compared to a real monitor.
Some people think the text looks fine, but I would be willing to bet they would also be fine with a 720p set at 32".
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