Right Michael, Y/C is better, but did you know that over 99% of the TV receivers (also most top end PAL receiver, unless they use combfiltering) receive and process in composite and not in Y/C. Even the best BBC programs which look much better (in apparent resolution and color) than most people can get with their prosumer cams in S-video, are composite signals. So composite isn't all that bad...and good enough for some ediiting work on a small TV.

well all i know is that if i drop chrominance or white ballance or sharpness etc type filters on some footage it is difficult to see on the monitor or TV screen any impact these make at all unless you use the effect to an extreme. Obviously a high resolution monitor allows you to see small changes very clearly indeed. The analogue out im using does not give a good picture on a tv screen. For example if i were to stick the smae footage onto a dvd and play in my dvd player, the pic quality would be better. So something is being lost in the output of the footage, which may be for example an avi file in my editing programme. firewire out feeds it back into my camera, which converts it into an anologue out. It is here that i believe an s video lead instead will improve the output quality. It is a means to an end. Obviously a monitor will be better, if you have one spare feel free to donate. Or maybe its a better analogue out than the one on the xm2? I feel that s vieeo is the obvious thing to try???
Interestingly there seems to be a brighter pic when i plug in both leads, tho this is not neccecarily a true representation of what the final encoded result will be so perhaps not worth bothering with.