1) "Real film" is definitely used quite often in modern filmmaking. Yes, digital cameras are becoming quite common as well, but a lot of filmmakers still swear by film. And rightfully so, for the time being at least.
2) All three Matrix movies were shot on film.
3) All movies, whether filmed on film or digital, are made up of frames. Every movie ever made is essentially a "slideshow". It's just an assload of slides going by very fast (24 slides per second).
Conventional standard definition video, which is what home video has been for the past few decades, is typically 30 frames per second. The reason for this is that electricity runs at 60 cycles per second, and 30 fits into that nicely, so there's no flicker problems.
When movies that were shot at 24 fps were transferred to video for home release, there was a process in which they converted it to a makeshift framerate of 23.98 frames, which somehow worked into 60 cycles or something. Basically, with standard definition for the past few decades, movies have never been able to be presented in their true framerate. Motion has never been as smooth as it is with true 24 fps.
Now with high definition and 120 hz tvs (60 fits into 120, as does 24), 24 fps can now be presented on home video. So motion is smoother.
I don't know why you're saying it looks terrible. Maybe you're thinking of something else, like MotionFlo or TruMotion or some other motion smoothing filter that the tv makers thought made it look better, but actually looks distracting and unnatural. Turn anything like that to the "Off" setting.
If you don't have a 24p tv, then it's fine. Someone like you (who obviously doesn't have a strong grasp on technical aspects of film and video) probably won't notice any difference anyway. It's really not anything major.
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