The article does say this...
The key message to take away from these pictures - use the right settings. Many HDTVs only run well at one resolution, their attempts to convert to other resolutions result in poor image quality, as demonstrated in these pictures.
So it does make it known that it's the TV causing such poor image quality....
Anyhow, in a personal experience, one difference I've personally seen between the VGA and the Component is well...more than one. Color, and clarity.
Component (@ 720p): More vivid colors but there is shimmering around the edges of small objects (ie. graphical Xbox controller buttons), almost like the sharpness is overdone causing the shimmering.
VGA (@ 720p): Colors aren't as vivid. Output is brighter with less contrast. Not as sharp, but can be adjusted using TV settings.
Both cables have some issues but it seems that it's easier to adjust the VGA's output to something I like.
Note that this is based off of using multiple monitors (HDTVs) each having Component and VGA inputs and running with the same color settings. And also through a scan converter which captures material directly to tape and not affected by any color settings on a TV. So it's not just the HDTVs it was tested on.
In Gun, using component just causes everything to look too dark..while it looks fine using VGA (again, tested on multiple monitors and a scan converter). Think developers are going to have to work on adjust the games color settings internally based on what cable is being used (which the X360 autodetects, so it should be able for the games to know). Guess the X360's output of VGA vs. yPbPr isn't exactly matching up with each other.