It seems to me that your PS3 and most of all TV are not set correctly then. You need to have 720p resolutin allowed in the PS3 screen setting (do NOT force it to 1080i/p only), use of course HDMI and have the relevant TV HDMI input set to "native" / full screen / pixel maping / game mode. Switch OFF any additional picture processing in the TV or any "enhancing" modes (like sharpening, frequency doubling, MPEG fragment correction and all other useless crap) and most of all switch off any "zoom" modes like cinema, subtitles and so on. If no dedicated "gaming" / full screen mode is available use the 16:9 / widescreen mode. If you have more than one HDMI try other input(s) - some might have diferent settings or preferences. Try another HDMI cable as well just to be sure.
