I ask again, did you follow all the firmware update instructions including allowing the TV to optimize itself after the update before using it?!?!?!
OMG OMG OMG, I figured a way to make it look super nice and clear on the PS3! You and whoever else plays on a PS3 might want to try this because it seriously makes the quality much much better. This works for both the PS3 and 360 (360 has optimal resolution so I would just use that)
First thing I did was I hooked up my PS3 to HDMI/DVI input 1. It has to be the first one since this is the only one with HDMI/DVI.
On your remote press source and then tools.
You will see
Go and choose Edit Name and Choose "PC"
When you're done it should look like this.
I've had a few people try this today and they all said it looked much better. Doing this enables you to get full picture on the screen with no over scan and the ability to use Pixel Shift. Game mode looks like crap and if you use screen fit it will not let you use Pixel Shift. My PS3 now looks as crisp as my 360 which has always been set at optimal resolution, this option is only available while the 360 is plugged into input HDMI 1, PS3 does not have this option. I am very happy with how it looks and I will no longer have to return the PS3.