Hmmm...interesting update:
Ok, when I put the monitor at 1280x1024 85Hz Refresh Rate, only the sides of the monitor are affected with pixely looks. The center is very smoother and very good quality.
When I put the monitor at 1158x864 100 Hz Refresh rate, I can see the lines of horizontal pixels moving all the way across the screen.
Lastly at 1024x768, I see just a grainy image, no horizontal pixels or anything...
And it's not my graphics card because I have a Trinitron, and it looks just FINE with it.