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Cablecard shouldn't do anything to "picture quality", it just decodes encrypted & remaps digital channels, not anything to the datastream or picture.
However as the 2nd post noted, sometimes this remapping includes using ADS (digital simulcast) SD versions of analog 1-99 channels, instead of the analog cable version, and in that case your picture quality may change (change can be good or bad, depending on your analog quality and the bitrate etc.)
The S3 does have noticeably better PQ on digital cable SD channels than my old Comcast Motorola 6412 did, though.
You can check in the diagnostics menu which you get, by tuning both channels to "analog" ones, go to diagnostics, and see if it says QAM or RF tuning (QAM is digital.)
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