"I think the digital channels (above 100) look pretty good, but my basic channels (below 100) look horrible. In fact they looked better when I had standard analog cable."
~Just to point out a fact here, your channels under 100 do not change at all, they are still analog, and they can't look any worse, inless you got a new big screen TV with the new cable service, or you wired your set-up wrong.
"1. I know that all stations are 100% digital, but does that include local channels as well?"
~ Yes, as said above. but the local feed comes to D* or E* in the analog form, and they upgrade it.
"2. If I get D* will all my channels have the same PQ as what my digital cable has for the channels above 100?"
~yes for the most part, if you plan on viewing them on a big screen they may look a bad. but on a small TV they will look great.
"3. How would you compare cable companies PQ vs D* PQ? Even though D* is all digital, does that really equate to a better PQ?"
~All cable companies are different, some have terrible PQ and some have great PQ.
"4. Last, will the HD channels that D* offers have a better PQ than what the cable companies provide? Although they look great compared to everything else, they do not have that WOW factor like they do in the store. Also, I had some OTA local HD on my set it look amazing, but the cable company does not have that amazing look. They do not offer local HD on my local cable yet, but they have movie channels and ESPN."
~Again some cableco's do HD really bad and some do it well.
I would almost definetly switch to D* if your cableco doesn't have any digital locals. but you MUST check with all of your locals to see if and when they broadcast in digital/HD OTA.