I have my Saturn hooked up to my LCD HDTV with S-Video and it looks ok. I haven't done a comparison with AV, but I could. I didn't know there were RGB cables for the Saturn so I couldn't say. Aspect ratio won't make much of a difference. The problem is that the Saturn is designed for CRT TVs so your TV is a better resolution than the output of the system. My 360 looks AMAZING on the HDTV, but stuff like the Saturn won't. Even games on my XBox (original) that aren't progressive scan look like crap on it, even with RGB.
I hooked up my Gamecube w/component cables and the games look like SHIT unless they're progressive scan. Resident Evil 4 for example looked like crap on my HDTV with component cables, but ok on it with S-Vid ones. It's all a big pain in the ass. The new compatibility problems are gonna become a hassle for all us gamers soon...don't get rid of your CRT TVs!
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You really have to mix and match and fiddle until you get the best you can get, or use a couple of different TVs for different systems.
I'd say if you can, hook your Saturn up to a CRT and only hook up newer stuff to the LCD if you can.