tcapote
Geek Freak
There is an app to help with that.. called "HD Contact Photos"...
They discussed this issue on the last episode of "All About Android"..
All About Android 63 | TWiT.TV
It's the very last part of the show.. Kind of explains why the pictures look so horrible and how to change it.
Thanks for the tip, btw, it's at the 1:16:15 mark if your interested.