SD also looks better on a smaller screen. The proof of the PQ is when viewed on a 60" or larger screen. There's a dozen reasons why the PQ has gotten worse over the years and the tide was slowed a bit with the introduction of Mpeg4. But the bottom line is $$$$$$. If they can decrease the PQ and increase the number of channels that puts more $$$$ in the bank. That would be their bank, not our bank. So, as long as the subs don't oink and complain too much the status quo will remain the same.
I have noticed on my 55" Vizio I need to run the HDTV's format in normal and my 722k's also for the best SD PQ, of course when the settings are normal the picture is smaller and normally not widescreen.