A video and graphics system has a reduced memory mode in which video images are reduced in half in horizontal direction during decoding. The video and graphics system includes a video decoder for decoding MPEG-2 video data. The video images may not be downscaled in the horizontal direction when no bi-directionally predicted pictures are used. The video and graphics system may output an HDTV video while converting the HDTV video and providing as another output having an SDTV format or another HDTV format. The output having an SDTV format may be recorded using a video cassette recorder (VCR) while the HDTV video is being displayed.