I've tried our Wii now on 3 TVs, two of which were Vizio's, one a 720p, one a 1080p and then on our 720p Samsung. All via component cable. On our 720p Samsung the Wii looks quite good. I would actually say great, but then I don't have a PS3 or 360 to compare it to, so I'll quell my enthusiasm a bit. I do get HDTV via broadcast, though, and yeah, it doesn't look that good, but still it does look very good. On the Vizios, especially on the 1080p Vizio, it didn't look that good. Very pixely, even with the sharpness turned all the way down.
So it depends on your TV, and probably will look better on a 720p set, but don't quote me on that. Definitely turn the sharpness down - this isn't a compromise for the Wii, this is to fix a mistake that is made on all shipped TVs, which is that the "sharpness" setting, which might more properly be called "noise enhancer", is set artificially high, because that's what people are use to. Turn the sharpness almost all the way down. Do that for everything, including for TV, DVD, BluRay, PS3 - everything. It will take a day to get use to it because you are use to too-high "sharpness", but then you'll see that it actually looks better.