I see here and there that this game supports 1080i, but do not know how to activate the 1080i video, you know how?
You must just the component cable connection (http://uk.playstation.com/ps2/accessories/detail/item51492/Component-AV-Cable-(for-PlayStation-2)/). As far as I'm aware 1080i only works on the NTSC version of GT4 via Options --> Screen -->Video Output --> HDTV (1080i). Not sure about the others sorry.
Just FYI, the PlayStation 2 is incapable of true 1080I (1920x1080) due to a lack of VRAM. It'll be hard-pressed to give even 720P (1280x720). This was probably why SONY never made 720P and 1080I offcial video modes in the PS2SDK, even though the GS can certainly output stuff like even 1080P (If the right values are set to undocumented registers like SMODE1).
LOL! Now, that would work. I think that 1920x1080x256 would work too, but... yea. Glorious Windows 3.1 colours in FULL HD. Now to think about it, that would be perfect for 2D games.
You know of the GS CUBE, right ? That had enough VRAM to do 1080P with 24bit depth... 32MB I think ... 32MB of EDRAM in 2000 would certainly make that chip cost more than it's weight in gold.
The PlayStation 2 was probably designed in 1998, when graphics adaptors with 4-16 MB were more common. 1999 was when it was revealed, wasn't it? The Nvidia TnT2 from 1999 already had 32MB of VRAM and a 150MHz core. Probably such tech in 1998 would have made it cost a bomb, like you wrote.
The problem is that *E*DRAM (Embedded DRAM) was difficult to make as usually the DRAM chips (memory in general) were made in different technology than the logic/processor chips and also to achieve that much on DIE RAM they had to compromise both the active logic design of the chip. It was still expensive at the time Microsoft used it on their XBOX360 design and even then the XBOX360 design is split on two chips (the GPU has two dies in it, one with the EDRAM and another with the GPU core...). Also the XBOX360 only has like 10MB of it.