I found the following advice on amazon which explains it perfectly.
The SCART Adapter supplied with the Wii simply lets you plug the composite cable supplied with your Wii into your TV SCART socket. Composite is the worst connection type for video and audio, leadin to blurry pictures on any TV much larger than 14".
The RGB SCART Cable breaks the audio and video signals into seperate wires/signals, resulting in a crisp, sharp image, with much better colour reproduction: it offers the best image quality for those of us without HDTV.
If you don't have a HDTV then you really need to consider one of these. If you do have a HDTV then the official component lead is the one for you!
If you don't fancy the idea of parting with £20 for another over-priced peripheral then you can always try my DIY tip.
Turn up your TVs sharpness and colour and in my case turn down the contrast a touch to compensate and if you have a decent standard tv to start with you will see a major difference
