...Unscaled mode would show all the content, but the text wouldn't look good at all.
Unscaled is the mode you should be running in IMO.
Looking at a couple of posts on the interweb, I have a few more questions.
- Do you have a choice of running your TV in HDTV or PCmode (something that some Philips TVs apparently allow you to do)? If so, is it set to PC?
- Do you have overscan on in OSX under Displays?
- Also under Displays, are you sure you're outputting 1080p, not 1080i?
- In what sense does the text look bad? Have you tried playing around with font smoothing in 'Appearance'?