I'm pretty sure "film mode" can only be activated when your screen setting is "Movie" not Dynamic or Standard. See if that works.
My Xbox 360 is hooked up through hdmi and when I'm watching a hddvd through the hddvd player but when I go to film mode it is grayed out. The only time it's not grayed out is on the tv source through antennae in, not even a digital cable box yet.
But even then the cinema smooth mode is still grayed out. Am I doing something wrong?