Not sure tbh, tune your freeview in and compare signal quality with virgin box.
Have a fiddle with the setting on the V box. Sky boxes have a pal/rgb output mode for scarts, rgb is optimum and can make noticeable difference.
Try you PS3 at 720p and 1080i and see what looks best. Even try 1080p as some tvs will accept this signal even if they cant output it.
Failing all that, if it is still crap, take it back.
If it accepts it it will only downscale it back to 720p/1080i again.
Just about everyone who buys a new tv moving on from a crt comes back to me (work in shop selling tv's) saying exactly the same thing. The normal culprits are:
Our rubbish signal in our area on freeview, combined with vintage ariel, using £1.50 scart leads from sainsburys.
The second culprit is, they normally go from a 28" CRT to a 32/37" LCD. LCD's are not as forgiving to the analogue/digital picture, and they normally sit with their noses pushed up again the screen. The correct viewing distance for a 32" is much further than most people are aware.
I havent noticed a post saying what tv it is yet, it may well be a cheap and chearfull tv, in which case you get what you pay for im affraid. Otherwise try it on an HD source with ideally an HDMI if its still rubbish return it. Try and do it within 28days, otherwise it can be a pain for the retailer to sort.