Thank you for the additional information!
The answer as to why one pixilates and not the other, has a couple of possibilities. May I have some more info, please?
A comparison of the signal strengths on the two units (same channel like you did, but instead of looking at the picture for comparison, compare the signal strengths) will provide crucial information about your system. Let me know how much the two differ. Since the SD is your largest concern with its blurry, blotchy picture, what is your signal strength on satellite 119, transponder 11, for both units? What is your signal strength for 110, transponder 11, for both?
Since you are using two "identical" units, their signal meters should read very similar signal strengths. (This does not hold true for unlike receivers.) It is premature to develop any conclusions without this information.
Possible causes and a troubleshooting exercise:
Cable quality - specifically, the cables and connections to the one that malfunctions (You do mention that you replaced a three year old receiver, so your installation is at least 3 years old, right? I
suspect poor cables or connectors in addition to possible low signal.)
Receiver sensitivity or defect - while they are identical units, there will always be a slight difference in the signal quality meters. The
amount of difference may provide some insight...I'll go ahead and say that it is unlikely that your unit is defective. The amount of "problem" you describe suggests low signal strength and/or quality.
To check whether it is a cable problem or a receiver problem, switch the places of the units. If the problem follows the receiver, it is a receiver problem. If the problem stays in the same room, it is a cable or connection problem.
In regards to your comment, "But what "they" don't tell you is that the newer generation receivers do a crappy job of displaying SD." Not true. This is another HDTV myth. Yup. Read all you want and you will hear people saying the same thing everywhere.
Here is the truth:
Newer generation digital receivers and televisions do
such a great job of displaying the input signal for SD (or HD) picture, that
everything that is out of adjustment shows up clearly
as compromised picture. They
very accurately display the digital picture according to the signal quality (garbage-in, garbage-out) and the quality of the television's calibration. Every piece of technology that needs a consistent result is calibrated. A simple scale for determining weight is a good example. Electronic or not, scales must be calibrated to weigh accurately. If the scale is not "zero-ed" or balanced without any weight on it first, then your resulting measurement will be off. Calibration of the scale insures accurate results. HDTVs also need to be properly calibrated. With HDTV though, the result is not so easily checked as with a measure of weight. Weight is an absolute quantity, where picture quality is not so easily defined.
The unfortunate part of it all is the amount of user input and knowledge that is required to get the proper results out of this new high-tech equipment. It is truly beyond the average user to
maximize their own systems.
I have only encountered 2 (yes just 2) systems that were "maxed" in regards to connections, settings, signal strength, etc. - and both of them still exclaimed "WOW" after a little calibration.
Many people tell me that "Oh, the picture is fine" when I ask for the TV's remote to access the user settings. They are fearful that I might mess things up. I ask them to bear with me just a little while and if they don't like what they see, I'll put it back the way it was...
I've NEVER been asked to undo the changes, always get a "WOW" or similar exclamation, and then they ask me to "do that" to their other TV(s), or send me to a friend or relative.