It actually depends on whats the place where people watch your videos.
For example, lets say you are a TV show producer. Your show will be viewed on HDTV via HDMI. So 1080P is definitely worth it.
If you are into stuff like time lapses and stuff (photography related), your audience will watch it full screen on their PC or LAPTOP.
Again, 1080P is must.
However, if your content is not of the artistic type. For example, you are a political narrator. The content is what you are saying, rather than the visual. Then 720P is overkill.
So decide based on your content.
A movie showing the glaciers of Alaska - 1080P must
A movie teaching German.. ? - 720P should be good enough.
If you have decent upload bandwidth at your home, you can encode with a less CPU intensive codec. Larger file size will be there, but you won't roast your processor.
If you are using a WYSISWYG linear editor, go for uncompressed, and then later use Virtualdub etc., for the final encode before upload.[DOUBLEPOST=1387172971,1387172837][/DOUBLEPOST]
Considering that a large majority of the people that watch YouTube only have 720p monitors. So no its not worth the extra rendering.
720P monitors? 1920X1080P is standard in Laptops since past 2 years. Very common.
PCs have been 1080P for long. Ditto for LCD/LED TVs
However, if your audience comes from mobile device(see your channel stats), then 720P is enough.
My mobile device audience is less than 30%. So I always try 1080P.
Since my work is photography/TimeLapse stuff based. I have to go with 1080P.
See my previous post. Check out your content and Audience and then decide. There is no one size fits all here.