I cannot speak to this year's LG plasma, but in January, I looked at LG and at Panasonic and the PQ on the Panny blew the LG away. I bought the Panny and could not be happier. With the recent price drop on the Panny, it's tough to beat for the price. SD picture on the Panny is about as good as it gets for SD. HD is outstanding as well.
One more comment. With the price drops, if your looking at 42" sets, look at the 50's. I am already looking to move the 421 to the bedroom and go bigger.