The issue stays in 720p format. The dealer said that this is a issue with pinwheel for most sony tv's only (model inspecific), and does not go away with any setting change on it.
Update: The problem is narrowed down to the receiver broadcasting in around 50fps to the tv, and the tv expecting 60fps. No option fixes it. As far as I think this is the issue according to online searching. Just putting it out incase someone is reading and knows a fix