What a blur fest...
Granted, I've completed the game on the PS3, it wasn't until I decided to rent the xbox version of it, just to compare.
First, if you have a 1080p capable tv set hooked up to your PS3, and the appropriate mode enabled in the PS3 settings, the game will run in 960x1080 up/down scaled fashion. The original 1280x720 pixel frame buffer is downscaled horizontally to 960 pixels and then uses PS3's hardware upscaler to scale it back up to 1920 pixels. And vertical resolution is scaled up to 1080 pixels. This produces incredible amount of blur and edge shimmer and looks just downright horrible. So if you want to have a somewhat sharper image - turn Off the 1080p mode in your PS3 settings - this will force game to forego the scaling back and forth and just work in the plain 1280x720 resolution.
On top of that, virtually all transparent textures in the game are rendered at half the resolution, which produces incredibly blurry and poorly defined effects, such as water, electric sparks, candle light et cetera. See Digital Foundry's face-off on www.eurogamer.com if you want to see the comparison.
It seems like a huge step down from the quality of the previous I stallment of the game: the first Bioshock wasn't so blurry on the PS3, and definitely looked better than xbox version in many regards (mainly thanks to slightly higher resolution textures).
So again, if you have the choice - go with the xbox version. If not - you're out of luck :( The game is still playable, but the blur is so in your face that it keeps ruining the experience from the otherwise fine game :(