In my experience, you should only ever need to use SetMaxVideoDecodeResolution on the older Roku 2 XD/XS models. I've never run into memory issues on the other platforms that have required making that call. It is also my understanding that calling it only affects the amount of memory being reserved, and has no affect at all on which streams the video player actually plays.
I understand that it doesn't affect which streams can play, but I was wondering if it may also down-scale as it does when you set the Display Type (i.e. 1080p content will play fine on 720p or 480p, just down-scaled).
I'm also curious if you have any feedback on the Roku 2 XD/XS models. Do you normally set the SetMaxVideoDecodeResolution lower than 1920x1080 regardless of the display setting?