I had been using component video directly from the cable box to the TV because I am still in the process of ramping up the home remodeling I want done and have yet to replace my former HT equipment.
The TV stand I recently purchased came with a free HDMI cable so I decided to use that instead of component video and analog audio. The SD channels actually look much better than they did before (not quite as 'soft') and text, especially on the cable guide, is sharper and easier to read. HD looks about the same to my eyes as it did with component video.
My theory is that the cable box does a pretty poor job of converting the digital cable feed to analog component video. Now with HDMI, it doesn't touch the incoming signal and it is the sole responsibility of the TV to take the digital signal, scale and/or deinterlace it and display it.
