video quality problems

  I just purchased a sony handycam DCR-HC32.  When I play back my movies on the smallest screen the quility is great.  When I make the picture bigger the quality goes way down.  I burned a dvd of the movies saved on my computer and the picture is horrible when it's blown up to fit a tv or the computer screen.  Is this problem with my computer or my camera.    Any help would be greatly appreciated.  Thanks