I think you need to go into your advanced configuration options and turn off overscan, not the widescreen/fullscreen scaling thing.
HDTVS have post processing features that cause small amounts of lag due to the image being processed before its displayed. Also these features make the image color, contrast, and quality worse. One common feature is overscan that cuts off part of the tv, another is fake "dynamic contrast" when you could just turn the real contrast settings up. Before adjusting my friends where skeptical, After adjusting my friends TVs they all where stunned by the difference in image quality, Sound Quality (even the audio settings have strange features) and response. My brother was even going to buy a new TV but now he feels like he has a new TV. So I recommend people try tinkering with there settings, try turning suposed "features" off and games get better.
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