Thanks for the replies guys, I will also check out getting a better RF cable. I looked up Longhorn Engineer but he wants $100 for the mod, that's like buying another 7800. If I did that, plus almost $100 for the expansion module coming out soon, that's $300 for a 7800, crazy, haha.
What bothers me is that with that expansion module coming out soon, I will not enjoy the games as much because of this kinda of picture.
If any one of you play Microsoft Game Room, that's EXACTLY how I would like the picture to be or similiar to it. No fuzz whatsoever. Perfect pixels.