fucking jaggies

[MetalMilitia]

I played a bit of HALO 3 on my HD TV a week or so ago and it was pretty ugly. The reason is that Halo 3 runs at only 640p (1138x640) while your TV has a native resolution of 1080p (1920x1080). The low resolution in addition to the complete lack of anti aliasing in Halo makes for all the jaggies.
It does sound as though you are sitting too close to the screen though. You should be around 6ft away from a 46" to get best results.

Best thing to do would be to try and get a good picture as it's hard to tell from your description if there is actually a problem.