As it's just a data file, any system can process it (as long as the software doesn't have artificial size limits). The rest is just raw speed ... so you don't tie up your system for days processing the file (multiple times, too) ... and so you won't view a stuttering "slideshow" before burning it to disc for a proper review.

Use a YouTube 1080p video (downloaded, not streamed) as your guide. If it stutters or loses audio sync, your system will only have much worse performance on your non-optimized video.

Regarding format size, there's "no need to guesstimate" (as explained in a CreativeCow forum post):

Not understanding professional resolutions
http://forums.creativecow.net/thread/54/859839

"No need to guesstimate - the Arri study at the top of the thread measures the ideal 35mm exposure on a 200 ASA stock, saying that the smallest resolvable detail is .006mm large on the negative.

Super 16mm is 12.35mm x 7.42mm or 2058 x 1237 "points"
...
but since the grains move around, the digital grid should be twice as fine."

Here's that Arri study (download link) if you like the tech stuff:
Arri 4K+ Systems - Theory Basics For Motion Picture Imaging.pdf
http://www.arri.com/?eID=registration&file_uid=3525

I've read elsewhere that optimum 16mm is slighter better resolution than our present 1920x1080 HD. Therefore, 1080p (or the 2K capture) should get everything there is to get. With the above-mentioned "moving [film] grains" issue, a final 720p might show little difference from a 1080p, with a less-than-optimum 16mm print.

But the archivist in me says - Go 1080p! :)