There is actually likely to be little difference between a good S video signal and an interlaced 480i component signal in consumer units.

Component really shines when the signal is progressive scan.

Can composite look as good as S? I have not only seen that, I have actually seen a channel 3 output look better on a TV than the S! No typos!

A composite signal is separated into Y and C inside of a monitor. An S signal either never was combined, or is a separated composite signal (as in laserdiscs, which were recorded with composite). So when you are figuring out which should look better, S or composite, you have to ask

a. was this signal ever composite? If not, S should absolutely look better.

b. if it was ever composite, does the device in the TV that separates it into Y and C do a better job than the device in your source item (again, such as a laserdisc)(or S vide VCR that recorded a composite signal onto tape as an S signal)? This is very hard to check, because you have to do real time comparisons of the device's composite and S outputs. And are many of us good enough to know exactly what to look for?