Film is not binary, grain is analogue and grains do not clump together like an inkjet to form tones- that is a myth spread by MR of the luminous landscape and is wholly wrong.
here is how film works:
Film emulsions are generally Ag/Br/I atoms combined into crystals from about 1 - 10 microns in size. They contain millions of atoms and many sensitivity specks which consist of sulfur and gold.
When film develops, it can form anywhere from 3 silver metal atoms minimum up to the entire grain, and grains can be stacked, and therefore the dynamic range of density is analogue in nature and virtually infinite. For practical purposes, it ranges from 0.1 - 3.0 density units in a normal negative B&W film

Here is some info from an Expert
http://motion.kodak.com/US/en/motion/Hub/nRodriguez.htm
see question two?
Q: What are the main differences between the way images are recorded on film and digital, aside from resolution?
A: “Film is analog, like the human eye. It sees and records continuous tonal gradations between black and white.
Film is analogue despite what the ignorant jibes of MR suggest

Without getting too technical, film is made up of tiny silver-halide grain particles. These are binary: they are either black or not black, on or off, exposed or not. Film is fundamentally a “dither” process, not at all unlike the way a CMY(K) ink-jet printer works (color in film is achieved with C,M, or Y color dye on grains on different layers). So while the grain size is often taken as the “resolution” of film, ignored is the fact that unlike an individual pixel which can be assigned any shade from a pallet of thousands, it takes a clump of 30 to 40 film grains to do the same.

But how big is grain? It varies of course (larger for “fast” but so called grainy film, smaller for slow but “smoother” film) but by and large we are talking in the range of .5 to 3 microns. In other words there are TENS OF THOUSANDS of grain particles across a 35mm film frame. For years people, even highly respected people in the film industry, have waxed poetic about seeing “fine film grain” in 480 line film-on-video. Hoo-hickey I say!

Here’s a little experiment: print something on your color inkjet printer, then scan it at a VERY high resolution (not exceeding your scanner’s true optical resolution) and you’ll see…not shades of color but rather individual dots of either Cyan, Magenta, or Yellow ink. If we could see film grain, that’s sort of what it would look like (not exactly, but you get the idea).

But we don’t see those individual grains. Ever. Not even when watching 35mm film on a screen several hundred feet across. Thank heavens, as that would look like &^*!. But we do see something which lets us know we are watching film. It is the net visual effect of film grain that is so artsy-fartsy: the placement of the grains on the film is random, so the “pattern” of grain is different for every single frame, and there is even overlapping of grains from the different color layers. What this means is that as the frames progress, the finest details “modulate” so to speak and you get film’s characteristic irregularity, or instability, of the tones, that sort of “shimmering” of everything.

With film-on video, even 1080 line, you are NOT seeing film-grains but you ARE seeing something of the optical effect of it, an effect which is unfortunately very similar to Video Noise (which just complicates things: half the time people talk about grain in the context of DVD, or even HD, I am convinced they are actually mistaking video noise for it). Further muddying the water is that this sort of irregularities manifest naturally in film can be introduced digitally for effect or simply be a by-product of video/image conversions, filters, and compressions…none of which have anything to do with film-grain itself (a digital camera for example often yields a picture which looks grainy due to noise at the CCD and/or internal image processing…and there is no film).

Now, I have not actually seen the Patton Blu-Ray yet, but fact is that simply by having such a large, LARGE area of film to begin with as you do with 70mm, when you reduce it down to 1080 lines, you do “normalize away“ some of that film-grain visual effect. You have many, MANY film-grains contributing to just one video pixel (about twice as many compared to 35mm), so even at 1080 lines there is that much less variance from frame to frame. In other words, the larger the original film, the less of the film-grain visual effect will come across at a given video resolution. So I would expect a 70mm source to look smoother (but again I’m not commenting directly on Patton).