Using the Artion template and in your thumbs, the logo in the background looks great. When I've looked at the demo with Firefox, Safari, or Chrome, it looks very pixelated.
I tried it on a new site and it's definitely pixelated like your demo. It looks like when you get to a certain point on the page, it shrinks down to fit to the top of the page. Is it possible that instead of shrinking itself down to fit in the header of the page, it's using that size to display extra large in the page background, which is the reason why it's so pixelated?