In another thread from years ago, Phil Mayor mentioned trying a different file type. I just tested this theory because I have been fighting image quality issues as well in SL3. I thought it could be related to the fact that we fill the browser window with the player or publish to HTML 5 only, but no it was the file type the entire time.
I have all pngs and once the course is published, many of the images become blurry almost smudged the way that JPGs can sometimes look when lower quality. WHat was odd is that with the photo zoom tool, when it is clicked, the image sharpens a bit, yet the original image is blurry and smudgy. I tested a variety of images that had been enlarged, reduced in size, enlarged in pixel, cropped, not cropped, etc (aka jumped all the hoops to test different options).
To test the idea that Phil mentioned in the thread I linked above, I started a brand new course, uploaded three different file types and when the course is published, the GIF/JPG images look worlds better than the PNGs.
Update: My triumph appears to be short-lived. When I upload a course into S3 for testing, the image is much improved. Once I load the course into CSOD, it goes back to not great. I even changed from GIF to JPG on one image hoping that would fix it and increased the image optimization to 100% on publish. The majority of the images did improve, but one the one I'm referring to is still not great. However, when the zoom picture feature is selected--the image sharpens to almost normal. I didn't resize the image in any way shape or form. I pulled the original PNG image into SnagIt to resave it as the other file types. This process worked for the other pictures that improved, but this one image has a lot of information on it and I guess it just won't improve. I tested the output in both Chrome and FF in the LMS and there's no difference.
