They have to tell you the picture and sound quality on pirated DVDs is bad to discourage you from buying pirated copies. The same as the UK government wants to discourage romanian and bulgarian citizens from coming to the country by showing dismal videos on their TV. The truth is somewhere in between I guess.
I have many pirated DVD movies, concerts and docos and the quality of the material is very good. Having said that, I always find the quality of the original DVD to be much better and the sound to be much clearer.