You're not going to get better than 800x600 on a TV screen, due to limitations of NTSC/PAL, PAL having the higher resolution (because it is lower FPS than NTSC). And the reason why everything is hard to read is because TVs don't use square pixels arrranged in a grid like a monitor, you'll see they tend to be rectangular and arranged in a honeycomb type fashion instead, so you're not gonna get as sharp an image. Certainly better for 3D games though, since you don't need to get the computer to anti-alias, the TV screen does it for you, so you can have higher framerates

But yeah, I tend to find Flying Mullet's method the best, add the TV after booting the computer up. You can also set it as a second monitor and extend the desktop onto it instead so you don't have to have the same image or resolution as the computer screen. and drag whatever windows you want onto the TV screen instead.