The difference you see is in the content, not the display itself. I have a 46" HD LED TV, and SD programming still looks like crap. HD looks stunning. On a 7" display, even with a HD screen you won't appreciate any HD content. The benefits from HD don't really become apparent until the screen is at least 20".
There are quite a few articles about HD and screen size. Do a bit of googling and you should find them fairly easily. That will help you decide if you want to upgrade to a HD screen for your car.