I agree - a buddy of mine had his 50" DLP hooked up using DVI. It looked like crap on his set - the DVD began showing pixels and distortion. I think that this was a limitation of the DVD (a well mastered one at that - Episode II:AOTC) rather than the connection. I think that the V had something to do with it - but maybe the component helps to "soften" the picture just slightly which makes the pixelation less noticeable. It's like taking a high def LCD projector, and displaying it "just" out of focus - that way, the screen door disappears, and the "digital edges" soften into smoother lines.
I'm not yet sold on DVI either - but I haven't seen a good presentation yet. In theory, it only makes sense that it would look better, but maybe the truest signal, without any compromises tends to highlight the inherent weaknesses in either the source or the video.
