Winston Churchill: You can have 500 hundreds TVs for all I care, content should be played at it's native refresh rate, the process of converting NTSC to Pal is extremly complex and is usually done by IVTC to restore the original FILM refresh rate of 24hz followed by PAL speed up but this is usually done by professional equipment
In the case of the Apple TV, the following happens:
Effectively, every 12th film frame is displayed for the duration of three PAL fields (60 milliseconds), whereas the other 11 frames are all displayed for the duration of two PAL fields (40 milliseconds). This causes a slight “hiccup” in the video about twice a second. Increasingly being referred to as Euro pulldown as it largely affects European territories. (Wikipedia)
There isn't any reason (or logic for that matter) as of why playing PAL on NTSC refresh rate or vice-versa would procduce better results.
Pummelfee: I can directly say this is NOT what is happening, since my apple TV is stuck in 50hz and is directly connected to a Lumagen Radiance video processor which supports every know consummer resolution/refresh rate, if that was the case then my Apple TV would run @60hz, there must be something else defining the default refresh rate maybe some regional settings, I'm not sure
Maybe I should send you my 50hz Apple TV and you send me your 60hz one, I'm sure it would solve the problem faster than waitting for support from Apple lol