Sharp not as sharp as my Panasonic? Am I doing something wrong?

I just picked up a DLP Sharp DT-400 to replace my failing Panasonic LCD PT-LC75U (designed back in 2001?). The colors and contrast on the Sharp do seem a bit better, but overall things seem fuzzier. I'm not talking about adjusting the focus -- when I have the projector menu up it's crisp and clear as can be. But when playing back a movie or watching something on cable, it's not "fixing" images anywhere nearly as nicely as my Panasonic did.

When I say "fixing" I'm referring to the way the device interpolates the signal to create the final image. In other words, if Cable TV and DVD is going through my S-Video cable at 720X480, then my Panasonic Projector had to do some manipulation to make that fit into 1024X768 and still look clear, which it did marvelously. But when I hooked up my new Sharp projector (1280 X 720) it looks noticeably fuzzier. I don't know if this is an effect of the higher contrast, the different aspect ratio, DLP instead of LCD, Sharp verses Panasonic, or if I have simply picked the wrong setting. The effect is like this image:




These aren't eally images from one to the next projector, I'm just describing the effect. The first image would be equivalent to native images on a computer. The second would be the appearance on my Panasonic. The third would be the Sharp.

Any ideas? Suggestions?

I'll give that a shot. I'll grumble a lot about it because it means climbing back up into the cieling and dropping wires down by the edge of the roof, but I know I want DVI for when I go Blue Ray this fall. My current DVD player doesn't have DVI though. Only S-video and component video.

Is the problem that the S-video on the Panasonic was geared for analog signals where the Sharp is geared towards digital? Why was the Panasonic clearer using the same S-Video cable?

Thanks ReconLabTech.

Is Component video preferred to DVI? I would have thought DVI would be superior since it's digital. I was thinking about putting a PC in my entertainment center and running a VERRRRY long DVI cable to the projector. I haven't even started researching them, but I'm guessing that Blue-Ray set top players and HD cable doesn't use a DVI cable. Running the DVI cable would let me play PC games at high resolution.