In FAQ:
http://www.dolphin-emulator.com/faq.html#play%20in%20high%20definition
If you want to play in 720p go to "Graphics -> Direct3D" and change the Window Size to 1280x720. For 1080p simply choose 1920x1080.
I tested on Mac (except the Direct3D part), even with 1080p on a HDTV - it still looks bad! But today I tested this:
Graphics->Enhancement->2x native
Graphics->General->1280x720
The result is simply amazing. The frame rate drops about 5fps, but the result is worth it!