The PS2 only supports 480p (640x480) output. Any 3D game looks pretty jagged at 640x480; it's just that on a crappy, blurry TV, you don't notice it as much as on a razor-sharp monitor.
A SD LCD-TV should look OK. However, on an HDTV of any type (with fixed-pixel models being worse), the crappiness of console graphics is much more evident. Progressive scan mode helps a bit, but you just can't get more pixels than are really there. This is, in fact, also a problem with some HDTVs when watching any SD content, not just video games. If they don't do a decent job of scaling the picture to the available pixels, it looks *bad* -- often worse than on an SD set.
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