I have managed to get a great picture with excellent clarity by using the PS3 to upscale. The most challenging parts to upscale are:
poor lighting (such as tunnels or a damaged ship)
red tunics (red in general)
softly lit outside areas (where there is already a blur - 'The Inner Light' is bad)
The PS3 settings are:
Frame Noise Reduction: 3
Block Noise Reduction: 3
Mosquito Noise Reduction: 3
Video Output: RGB (the Y Pb/ etc setting is poor for TNG as itd desaturates the picture badly)
RGB full range: On
Dynamic Range control: On
In some places the picture looks very close to true Hi Def. Usually the more stable the shot (such as Geordi talking in front of the warp core in 'Hero Worship' and talking about the firre where you can even see the wonky steel rods in his VISOR) the better, but even on TOS-R there's motion blur when moving.
A professional level upscale would vastly improve the show visually without the full remastering, though clearly a fully remastered version would be better.