TNG just never looked particularily good. I guess they didn't have DVD in mind when they were making it, seeing as they did all of the post-production on NTSC video. When you watch it on VHS, you don't really notice how bad the picture is, but DVD really brings it out.
Edit: Beaten to it
Yeah. Its sub-DVD resolution to begin with.
As for the audio, I find I'm tweaking it a lot, trying to get the 5.1 track to sound decent though I'm using (4) 3-way speakers, so no center and no subwoofer hooked up.
It's great for music, but for tng it sometimes sounds better in 2.0