Hi William,
Yes, this is possible but there are caveats and it will depend upon whether the frame rate you are using is NTSC or PAL compatible.
HD material for down conversion must have a compatible frame rate with standard definition video. You can use HDTV 1080/59.94i or 720/59.94p for use with 29.97fps NTSC. Alternatively use HDTV 1080/50i for use with 50fps PAL.
HDTV720/50p down conversion to PAL is not currently implemented as there are currently no decks which support the rare HDTV720/50p standard.
If playing out HDTV 1080/23.98p material and down conversion is desired, choose a Blackmagic HDTV 1080 23.98 -> 59.94 easy setup. This will enable 3:2 pulldown and convert the video to an NTSC-compatible frame rate so that down conversion can be used.
Might this explain your problem?
Regards,
Luke Maslen
Blackmagic Design