Cory a.k.a. “Mr. Safety” of SMP Films gives an excellent tutorial on how you can upload sharper videos to YouTube (and all of the other video sites) using Sony Vegas 5. I highly recommend Sony Vegas if you need a good video editing program.
If you don’t have Sony Vegas, try to use these settings on whatever video editor you currently use. Some of the keys are using 30 frames per second, speed of 1mbps or higher, 128 kbps audio and the sharpest possible settings. I use slightly different settings with Vegas 7: Render as MP4, Best video rendering quality, 30 fps, 2 mbps constant bit rate and 128 kbps audio. Experimentation is the key.
What settings do you use?