Pretty much the source, yes. They can't make detail out of nothing cheaply enough to allow the TVs of today clean up the pictures that need to be expanded by a factor of x2 each direction. Sort of like blowing up a picture on the computer. There are very expensive pieces of equipment to "fill in" detail, but are way beyond the cost of consumer electronics.
Then the decompression artifacts can only be delt with at the time of decompression, if at all. Once the receiver hands it off to your TV, there is little the TV can do to clean up the picture. That is why in many cases the analog signal from OTA or cable will look better than the output of a satellite receiver or digital cable box. The TV is better equipped to scale an analog signal than it is able to deal with an analog or digital signal that contains decompression artifacts.
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