If it's a proper setup then it could be a proper composite RGB but more than likely its probably the aux inputs (yellow/red/white), it could just be the cables I'd guess.

If Video1 is your regular DVD channel then that is probably RGB SCART, Video2 should be RGB SCART too so you should be able to use that for the HDTV, as it would be better than the aux cables, and then I'd guess the 2 component channels are the aux component channels.

It just sounds like you need to plug your DVD into the TV via SCART instead of via the aux composite cables.