Your LCD TV lets all the flaws/artifacts in a compressed SD signal shine
I have a 50" RP LCD TV and a 32" Tube TV. The LCD is fed from S-Video and the Tube TV get modulated TV-2 stuff. The pic on the tube TV looks much nicer becuase
1. The pic is smaller, so the pixels, flaws, and artifacts are smaller and less noticeable.
2. A tube TV tends to "smooth" everything out, so everything's less noticeable.
In fact, on my tube TV, the only time I can ever really see any sort of pixelization is around station logos, credits, and other bold graphics layed over video.
Now, when I watch a DVD on my RP LCD TV, the picture is amazing... Next week when I'm watching HD on it from my 622 (if everything goes as planned) I'll get to see some 720p action (my set's native resolution).
Another thing about tube TVs is, especially direct view sets which are never going to be over 40" (usually max out at 36") is that you'll be pressed to see any quality improvement (or at least I would be) with a quality signal via antenna, composite, or S-Video. My tube TV, which used to be my primary TV before I got the 50", looks just as good now being fed a modulated signal (on channel 62) from my DVD player over a 50' cable run as it did when my DVD player was connected to it via S-Video.