BioShock was only mentioned 5 times in this thread (omitting quotes) and to be frank I'm disappointed. Just to square things away I'm going to say it 14 more times to up the count to where it should be.
Even if it did, it would still look soft as it would be scaling to 1680x1050, not rendering at it.
You need to leave your 360 in 1280x720 for games to run properly and look at their best anyway, so if your display supports it, that's what you should be using. (and on most displays, that will tend to look sharper, as the 360's scaling is crap.