PS3 Backwards Compatability

Is the PS3’s rendering of PS2 and PS1 games intentionally broken or just poorly implemented? You be the judge. This wouldn’t be such a big deal, but the PS3 contains PS2 chips inside to make all of the games compatible, so why are they being rendered so poorly? Also, lets not overlook the fact that the colors of the PS3 display look horribly washed out. Anyone else feel the whole system was a rush job?