I disagree with the suggestion to use no sharpening. I find sharpening to be critical in any kind of digital printing; sharpness gets lost both in the scanning process and in the raw mosaicing process, and needs to be restored. Print drivers also reduce sharpness slightly. I'd suggest a look at the most recent book in the Blatner / Frasier Real World Photoshop series for a tutorial on sharpening workflows. It's a subject by itself.
As to your original question, with many current inkjet print drivers, I see zero difference between interpolating in photoshop and just letting the driver do it. I'm still in the habit of resing up smaller files to 720 or 360 ppi, but can't say there's a good reason to do it.
My understanding is that things are very different with some other kinds of printers, like light jet.
In the end, the only way to know for sure it to experiment. It's easy; you don't have to make a 16x20 print. Just print small portions of one. You can print four print samples on a single 8x10 sheet for comparison.
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