If I had to guess, I'd say that Hybrid's driver is a software-only rasterizer and wouldn't take advantage of the 2700G in the Axim at all. You could ask on the OpenGL ES dev forum at khronos.org though. The Hybrid folks contribute to that list and could verify my assumption pretty quickly.
If all you want from 1.1 is auto-mipmap generation, can't you do this manually by rendering your level 0 texture to progressively smaller quads with bilinear filtering enabled, then save the contents of the color buffer as a texture map? You'd only have to do this once when the app/level loads so it doesn't have to be overly performant. I'm a D3DM guy so I don't know if you can even do this in OpenGL ES, but I'm sure there are some others here that could comment.
Right that would make sense if I bothered to think about it before posting, hybrid is not going to be making drivers for the various 3d chips that are going to become available, rather their software implementation can work consistently across all platforms
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