From the New Lucas interview - the originals “look terrible” thread, by digitalfreaknyc:
The complete Cannes interview (with George Lucas):
https://www.youtube.com/watch?v=AHXLsHOdPiw
Fast forward to timecode 53:08 … the interviewer asks Lucas a question from a fan, if he will release the original versions in the future. Lucas drops the “it looks terrible” quote a few seconds later.
Thanks Haarspalter.
I think the whole “Special Edition” section is worth viewing. It is only 5 minutes long, starting at 50m 42s into the video, and there are also chapters timestamped in the video description.
The part where George talks about the film belonging to the director and he “should have the right to have the movie the way he wants it” (but makes no mention of Kershner or Marquand directing the other two OT films, nor him making changes to their films), and George then talks about Michelangelo, starts at 55m 23s.