Ah! So my post wasn't deleted, just a new thread created.
So here is the issue. I am just a bit frustrated with what I guess I may or may not be understanding about the 360, PS3, & my TV.
I have Dirt for the 360 which supports 1080i which is what I play it at & it looks great. I tried the Dirt demo on the PS3 & it looks like poo in comparison.
If you could be a little more specific on what the differences are, that would help us determine the exact cause. For instance, the 360's version of Dirt is, for most people, too bright (HDR / contrast levels) and has too high a contrast, for others it is great. The PS3 version is much more balanced, but depending on your set, that can make it look too dark for you. In this case, it is really a matter of balancing.
I am using HDMI for the PS3 & of course my 360 doesn't have HDMI.
There are actually some 360s out there with HDMI you know.
So like mine, it is a 1366x768.
In your case, a lot of things will depend on the scaler situation and how that affects your game. For instance, most games when you set the PS3 to 1280x720p will be upscaled by your TV to 1366x768. If your TV's scaler sucks, then if you do the same on the 360 and the 360's scaler is better, you'll have a better image using the 360, given that all other factors are identical.
Same kind of thing goes for 1080i. If you have your 360 scale the image to 1080i, then (depending also on the original game's resolution) you'll again have a two step scaling process, because your TV will take that image and scale it to 768p. In some cases, such scaling may end up taking away a lot of jaggies, again depending on how all the scalers involved work.
To determine what looks better on your TV with the PS3, I have decided to base that on in which mode the webbrowser looks best. You may want to give that option a try - also look for color banding, which is often worse if your TV does a lot of scaling (in my case that is true).