We just completed a doc and while waiting to hear back from the big festivals, we've had some invites to screen in smaller venues that unfortunately don't have HD Cam. Our final digital output is DVCPro HD 720.
Whoever is contracted to run the film festival will most likely have an image processor such as a Barco (Folsom) Image Pro or a Screen Pro II upstream of the projector for a few reasons:
1) it's a constant feed to the projector so the projector doesn't have to re-aquire the signal with each new source;
2) it's set to match the projector resolution - these processors have a $5,000 internal scaler vs the $50 off-the-shelf scalers that most high end and consumer products use;
3) the processors can store a logo so in between films we have something to put on-screen while we're cueing up the next clip.
DVCAM will allow an SDSDI or Component connection to the switcher whereas a DVD will allow Component at best. Plus DVCAM is higher quality - 25 Mbps vs 6-9 Mbps from a DVD.
I would contact the AV team to find out what they're providing as far as equipment goes. Personally, I would render my video out w/h.264 at a full 720p frame size and use my Mac to play it. You'll get the best quality/least scaling if you set your output resolution to the projectors native resolution. If the AV guys know what they're doing you should get pristine quality going this route. Of course this may be obtrusive so you'll most likely be rendering a file to support whatever equipment is on show-site.