So I've had a PS3 since the thing came out and it has been my BD player. I'm wondering if after all these years there are better non-3D units to be had. I have a Samsung 40" HD set with 120Hz refresh. So is it worth upgrading to anything in the $200 or under range?

Better units to be had? Certainly. Better units under $200, though? If all you're interested in is US (Region A) releases, you're probably just as well off with what you have.

The PS3 would be the spec system every bluray is tested against. So why would you want to risk future compatibility issues if you still have a working one?

Just checking...

Every time I go into the local BB, I see Ghost Protocol playing and the resolution is sick compared to my TV. I'm wondering what my TV is lacking. Guess I'll have to corral a blue shirt and pick his brains.

I don't think you're going to get a lot of actual help from a "blue shirt" at Best Buy. Most, if not all, Blu-ray players should offer almost identical picture quality. The difference you are seeing is in your display. Have you ever messed with the picture settings on your TV? This can make a huge difference. You can use a disc like Disney WOW to properly adjust contrast, brightness, and color. There are also sites on the internet that will publish recommended settings for certain TVs. These settings are universal for the model number, but don't take into account your display and viewing habits.

Keep in mind that most big box stores will have their TVs in torch mode with high contrast, brightness and over saturated colors. This can lead to a very bright and colorful picture, but ultimately it's not an accurate representation of the source.

I would also check AVSforums if you have a chance. There might be a thread dedicated to your display that offers tweaking advice.