The issue we have is that in iTunes SD specifically means a file that is good for older mobile devices and is 640x480 or less in size. In order for iVI to make an HD/SD pair in iTunes to support older mobile devices we have to tag the version at 640x480 as SD and the other version as HD otherwise this doesn't register correctly in iTunes. So really in iTunes language HD is larger than 640x480 and SD is 640x480 or less.
Because of this we now offer two ways to control the HD flag in iVI.
The first is that you can set it manually by double clicking the file in the iVI main window and then choosing the HD setting.
The second is to add an automatic rule on the Rules tab of iVI's Preferences.
If you wanted 720P to be the point at which the HD flag is set then you need two rules like this...
if video height is less than of equal to 719 then change HD flag to Not Set
if video height is greater than or equal to 720 then change HD flag to Set