Rory : yes, the game is going to be stretched anyway. But the video controller still need to rasterize more pixels.
That was the same problem when the iPhone 4 went out, with its retina display. The 3GS what doing a lot of things still faster, because all the hardware wasn't bumped as what was needed to handle the Retina display. Since then, the 4S closed the gap (using more beefy hardware).