There's something wrong with the TI itself. Great. I'll be in town, tomorrow, and I'll be passing by Walmart, so I can pick up a balun of the type you mentioned, if they have one. If not, there's a Lowes next door, so we can try that. Fortunately, the TV does have a coaxil port, just don't know which setting on the thing we'd need to put it on to test it out (probably cable).
Good Luck on finding a balun locally..... As far as the input setting on the TV it probably says Antenna, Cable, or TV, etc. On the Modulator set that to modulator and the channel to 3 or 4. You'll also have to set the TV to channel to 3 or 4.
If you already knew this... just thought I'd cover it anyway.