FYI for everyone, especially Mr. Laser Beam. I called Sony customer support and they walked me through shutting down the "upscaling" on the blu-ray player. Although it isn't as simple as turning it off, my blu-ray player has the option of turning on and off the BD-DVD- ROM 1080p format in the screen options in the main menu. Once I turned it off, everything went back to normal.
I asked what that did, and the man on the phone said that it essentially turned off the "upscaling" the blu-ray player does when a dvd is inserted.
I can't tell the difference in quality as I actually believe the DS9 conversion to DVD sucks anyways, so it makes little to no difference. It still fits the screen and isn't pixelated.
If the blu ray player does the upscaling, the TV gets a 1920x1080 pixel signal. If you disable upscaling in the blu ray player, it gets a 720x576 pixel signal. Most TVs even show what signal they get in the upper right corner or something (saying "1080p", "720p", "576i" or something). And then your TV does the upscaling automatically. There really is no difference.