Is this problem LCD, HD or is this just a normal thing?

A few weeks ago i won an HD-A3 HD player off e-bay. Today i finaly got in an HD dvd to play on it. Ive been playing regular SD DVDs on it latley.

Since ive had the HD DVD in i got kinda close to the screen to see if i can see the better definition. It looks really good but im seing this wierd thing happen. It looks like heat signatures around moving objects in the scenecs. The first HD disk i got is "Black Rain" there are a few parts where they have solid back grounds when objects move infront of the solid objects i can see what looks like heat signatures around the objects. Thats the best way i can describe it the background looks infocus but when the moving edge comes near the background has this weird blur outline and the pixals seem to smudge away as they change. It reminds me of what heat looks like as it ripples off somthing hot it kinda disturbs that focus around the edge of the hot surface.

Really weird but it still looks really good. Its just around the edges of moving objects and i can only see them when there is a solid back ground if i lok really close around the edge i can see it.

I believe what you are describing are commonly known as "Mosquitos"
It has to do with over compression of the imagery and your set may have an option to reduce the appearance of them....

So its common? i dont notice it on 1080 stations off the cable box is why i wondered. I may try and get a picture of it if i can sometimes its tricky to take pictures of tvs. LCDs might be a little different.

Black Rain was not one of the best transfers so the PQ is a 3 of 5 at best IMO. What is likely happening is the LCD is having trouble with the noise in the picture and this is part of the issue.