Looks too pixelated even with 1080 resolution!

Comparing a 2003 WS-65813 rear projection TV with the 65734 DLP, I'm not happy with the picture quality of the 734. It doesn't look realistic compared to the 65813 I just gave to my parents. The 734 isn't as sharp nor does it have the life-like depth that the rear-projection 813 had. The biggest annoyance plagues me every second: the pixelated/digitized image of the 734 makes it look like you're watching a lousy, lossy-compressed, digital representation of the original signal. DVD's look bad from even 12 ft away - don't even dare trying to watch it at a closer distance or you'll notice lost pixels. In other words, instead of a nice resolution to make up the face of an actor, you can see the bleedthrough fading from one pixel to the adjacent as if it were doing some sloppy rendering. This 2007 DLP is taking a step backwards, presenting less realism than rear-projection sets of the past. They must be cheap to manufacture - the 65813 was $5000+ (not including tax or warranty) in 2003 (value of dollar higher too), and now with the dollar at .75, the 65734 was $1699 at Fry's. Too good to be true. I'm hoping I don't have to replace capacitors in this Mits set like I had to do for the 65813 (like thousands of people have had to do too). I have 20 more days to decide whether this TV goes back to the store or not. It will probably go back sooner than that.