The RF output comes from the modulator. All the modulator does is to put the composite video signal onto a high frequency carrier. The main problem with the modulators and hence the RF output, is that these are analogue devices which use a capacitor-inductor to form the high frequency oscillator, so are not at the exact TV channel frequencies (so not all TVs can correctly tune in and lock on to the signal). Plus they drift as the inside of the computer warms up (the resulting symptom tuning drift).
However, the main problem is the composite video signal. Various compromises were made when coming up with a system of adding colour to the existing monochrome TV standards. So the colours on a TV picture from a composite video signal will always be nowhere near as good as RGB. This is the reason that the 'brown goods' (radio/TV/VCR etc) industry came up with S-Video, as it separated the colour signal from the rest of the video signal. As at the time there was no world wide standard for a RGB connector outside Europe.
One of the problems with composite video, is that parts of the monochrome video signal and parts of the colour signal may overlap. So the circuitry inside the TV has to try to distinguish between them. But it will not always be successful. The result is incorrect colour patterns or loss of detail (sharp edges become blurry).
In terms of quality, the various analogue video systems rank in this order (poor to excellent):
- RF
- Composite video
- S-video
- RGB
A RGB lead is the best solution.
Mark

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Looking forward to summer in Somerset later in the year
QL, Falcon, Atari 520STFM, Atari 1040STE, more PC's than I care to count and an assortment of 8 bit micros (Sinclair and Acorn)(nearly forgot the Psion's)