1 millisecond (1 ms) is the cycle time for frequency 1 kHz .
The TV can do 120hz that equals 120 milliseconds.
But the LCD panel can only do 8ms response time, so the panel is getting sent 120hz but it cant keep up.
Meanwhile, plasma display's pixel response time is virtually instantaneous, limited only by the speed of the video processing
this is what might be causing the pixalation.
check out this link.
I just found it, while I was looking for an answer for you.