Right now, 120Hz HD displays are popular because people want a TV that can accept a 1080p video input and display it without or with as little conversion as possible. HD movie formats, like Blu-Ray, have movie content encoded in 1080p so the idea is HD movies on Blu-Ray (now that HD DVD is no more)
should look better on a 120Hz HD display. This is NOT to say you MUST have a HD display running at 120Hz to enjoy HD movies in all their glory, it's just that the current thinking is having a display running at 120Hz will eliminate artifacts that can be introduced as the HD video is processed by the display before it's shown.
You can read a short article on this
here.
Peace...