if you are using original V1 the video panel size is 320x240 (i think) in some cams thats other then Logitech resolution will be automatically "smoothed", and if you happan to have logitech then it will be squared pixlized image. As to changing resolution V1 doesnt have support for Video Pin so you realy need to use AMCap for that.
In V2 resolution will be smootthed automatically by DS filter all streams look good and Video PIN config is alredy added. But I'm still strugling to make DS work the way i need it Maybe some one knows DirectShow better then me? There are samples in C# but I use VB and since DS is not .Net structured conversion is not working very well