The Bluray master is 1080p in number of pixels, but somewhat closer to 720p in actual visible detail. Therefore, downscaling it to 720p results in little to no loss of detail in presentation.

Note however that the Bluray is still significantly sharper than these 35mm print scans, due to generation loss.

The inescapable logic here is that 720p is entirely adequate as a final distribution format for this project as well, and that anything higher would simply result in larger file sizes without actual increase in quality. Obviously, all the work would be done at much higher resolution than this to maintain quality throughout the restoration process, but as the final step of making an actual product for distribution, it is doubtful that converting to 720p will result in any significant loss of visible information. The benefit of manageable file sizes for download certainly also points to this as an attractive option.

To make an analogy with audio, we typically record music at 24-bit resolution and mix at 32-bit floating point so that the digital processing is done with maximum accuracy. But for final distribution, reducing to 16-bit as the very last step allows for the earlier quality to be retained with minimal loss of perceived detail (with the caveat that proper dither must be applied in order for the conversion to be audibly transparent).