720x576 is the "full" PAL resolution, so use that. You'll note PAL DVDs are always either 704x576 or 720x576.
Unless you're using VGA->Component cables, anything above 384 pixels horizontally exceeds the limit of SVideo and Composite connections, so there's no real gain in pushing for 768.
720x576 looks great to me on my PAL TV. Happy to post the mode line if you want.