It's passive 3D, LG only has passive. I also prefer it (brighter image, easier on eyes, no batteries, lighter glasses and no flickering). I also don't notice any difference between the image quality.
Anyhow, LG's 3D TV's have a feature to convert everything to 3D as well. But for 2D stuff the effect varies. It's never to the extent of real 3D stuff, but in some shows it can add a surprising amount of depth (I find that it adds to Seinfeld a good amount). Same goes for games. But since it's turning the 2D into 3D using complex calculations and whatnot, things can also look odd. Anyhow, it's the same thing on active 3D TV's who have the 2D --> 3D conversion.
Read the mania: http://www.fanfiction.net/~nonexistinghero In SA2, it's Super Sonic and Hyper Shadow.
3D's okay for 360. You'll really get the effect with 3D blu-rays (avatar is like a whole 'nother movie), but from what I've tried the Halo remake is decent. PS3 does 3D gaming better IMO. Gears 3, BlOps 1&2, and AC3 I preferred in 2D.