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I understand what you mean.
It's possible to have LCDs display images that aren't clipped or with poor gradients. I watch digital content on my LCDs all the time which have no visible banding or clipping.
Where did you get your digital converter? Is it a problem with the digital signal they switched to (e.g. low bandwidth, local to your area) or is it that your own personal converter is low quality?
LCDs have their own weaknesses (and strengths), but they're entirely separate from what you're describing. A poor quality converter =/= issues with the screen itself.
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