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I had the problem on my friends tv.
Switch the cable for the component cables to regular TV rather than HDTV, then start the XBOX
Go all the way to the right blade, and go into display settings. For HD resolution, (don't worry if it warns you you're not in HDTV setting) select 720p, then before it switches back to regular TV settings, go to the cable on the XBOX and switch it to HDTV, and select "Yes, I want to keep this setting." It'll start displaying it right. It's sooo much faster and clearer this way.
I found out it was because the component was set to 1080 setting which I suppose is out of the range of the TV.