I was able to get a great deal on some oak hardwood flooring from CL and decided that it would look great on the wall behind my TV.

I've read up on this before and have found that it is recommended to prepare the wall like you would a floor and cover it in plywood.

I've also found a great deal on enough Pressboard to complete the entire wall for far less than it would cost me to do it in plywood (Actually nearly 1/3 of the cost of plywood)

My question is this, if I go ahead and use the pressboard for the project, will it hold up fine? I know they build cabinets etc out of this stuff, so I would imagine that it could probably do the job, but will it do it well enough to go through the trouble with it? The flooring I got is hand select utility grade that is 3/4 thick and is tongue groove style, so I was planning on putting the pressboard backing up to cover the wall, and then brad nailing through the grooves to hide all the nails. Then to finish the wall, I would stain it a darker mahogany color.

If it makes any difference, the wall in question is 21' wide by 12' tall at the peak, and has one arched doorway in it. I would also imagine that with pressboard, any and all wall mounted items would definitely need to go through to a stud (added length to each mounting screw) as the pressboard would only stripout and leave my tv shattered on the floor.

Depends on your terminology. If by "pressboard" you mean a panel made up of basically sawdust and glue (which is what pressboard is) then it's not a good idea as a backer for T&G - even on a wall. What happens is that the nails through the T&G tend to chip out the pressboard, causing the T& G to release. Sure - this is a greater problem on a floor vs a wall but it can still happen.

Now, if by "pressboard" you mean an OSB panel ( made with large flakes of wood and glue) then it will hold T&G on a wall OK.

I have often seen the term pressboard used for both pressboard and OSB.

Is this flooring prefinished? If not how do you expect to sand it all so it's all flat?
Unfinished flooring will not be flat when first installed.
I personaly would use a narrow crown pneumatic staple gun with 1-1/2 staples instead of a finish nailer.
Reason being I feel it will have more holding power and the tip of the gun is flat so it makes it easyer to fit on top of the tounge.
I agree 200% with Jaybee, partical board is about useless when it comes to holding fastners, swells up even with a change in humity.
When starting to install it I would strong suggest taking great care when getting ready to attach the first piece. Reason being inside corners are almost never perfectly plumb or flat from top to bottom.
If that one piece is off the whole wall will be off.
Sometimes it helps to use the longest piece in the box and rip the board at about a 5 deg. angle so only the very tip of the angle is touching the wall.
I use a 6' level when setting the first one and scrib the butt edge so there's 0 gaps.
As soon as I see where someone had to use inside corner moulding i know it was not a pro that did it, there trying to cover up the mistake.