Ben, what do you mean 'if set up properly' but what would I be doing that is hindering its full capability? (your about to suggest a crazy sound system?)
Nah, not at all. What I meant is that you would want to make sure that the video of your display is calibrated correctly. Without a colour analyzer this cannot be done 100%, but you can greatly improve the quality of your video by making sure that the colour, tint, brightness, sharpness, etc aren't crushing any part of the colour spectrum, nor distorting the image.
There's a great setup DVD called the
Avia Guide To Home Theater that walks you step by step through this process and is perfect for the casual viewer.
In fact, many of the test patterns that you need are on most THX DVD releases under the menu option
THX Optimizer, but without the know-how (and the proper colour filters that come with a setup DVD like Avia) the patterns are useless.
To take it one step beyond would be to have someone (like myself) do an ISF calibration on your display. That will involve making sure that the grey balance is correct first. (Essentially means that you are ensuring that the display is putting out the proper ratio of red:green:blue). This often means going into the service menu for your display.
The really gung-ho method is to get your own colour analyzer from Sencore and a copy of
Digital Video Essentials and doing the ISF calibration yourself.