I have had this exact discussion before, and could NOT find ANY evidence that the "modified" sine wave output had ANY ill effects even on high-end electronics.
If ANYONE can put forth any information debating that, I would love to see it.
The following was copied from Xantrex (a high quality inverter manufacturer) regarding true sine wave vs. modified sine waves and thier affects on different electronics:
What are the practical differences between modified sine wave (MSW) and true sine wave (TSW) output?
Most AC products run fine on MSW inverters. TSW inverters are about two to three times as expensive per watt due to having more sophisticated design and manufacturing requirements, and more expensive components. As a result, most people prefer to use MSW inverters if their applications allow it. Xantrex Technology Inc. does not guarantee that your AC application will work with an MSW inverter, and we advise our customers to check with the manufacturer of your AC device as to whether or not it will run with a Xantrex MSW inverter or whether you should purchase a Xantrex TSW product for your application.
Can I turn an MSW inverter into a TSW inverter?
If you have an MSW inverter and suspect you need a TSW inverter, please note there is no ?filter? or ?retrofit? you can apply to the output of an MSW inverter to ?clean up the output? or ?turn it into TSW?.
Here are a few pointers about which kind of inverter to use:
In general, any device that senses either voltage peaks or zero crossings could have problems when running from MSW. Devices such as these should be run from TSW inverters. Ham radio and CB radio operators may notice RF noise from MSW inverters; in that case do not run the radio and the inverter at the same time. Electronics that modulate RF (radio frequency) signals on the AC line will not work and may be damaged. You may notice hum or buzz in the audio of TV?s, radios and satellite systems used with MSW inverters. Audiophiles or professionals using sophisticated audio, remote measurement, surveillance or telemetry equipment should use TSW.
Examples of problem devices are motor speed controllers employing triacs, and some small battery rechargers that do not incorporate a transformer between the utility power and the load. To help you visualize this, if there isn?t a ?wall wart? between the battery charger (or the battery in the device) and the AC plug, don?t use MSW.
Please note two other common problem loads, electric shavers and emergency flashlights. Both of these items have batteries in them but connect directly into the wall to charge, without an external transformer. Don?t use items like these with an MSW inverter. If you do use an MSW inverter with a transformer-less charger, your product will likely be damaged. Garage door openers, laser printers and large strobes used in photography have all been reported as trouble loads for MSW inverters; they either don?t work at all or stop working entirely, so don?t take a chance ? use TSW.
As a general rule, products operating through an AC adapter will work fine from an MSW inverter. These include laptops and cell phone chargers, video games, camcorder and digital camera chargers. Televisions generally work well; some VCR?s with inexpensive power supplies run poorly. Consider switching to another brand of VCR in that case. A potential solution for RV?ers or off-grid cottagers is to purchase a small TSW inverter (such as the RS400) to run TV, VCR and audio equipment, and a larger MSW inverter (such as the XPower 1750 Plus) for the coffee maker, hair dryer and microwave.