I don't think images can "fade" on a VHS so much as just not work anymore. If anything, the image quality is strictly due to the source quality as well as the limits of the VHS tape itself - things like chroma and analog noise. Maybe it looks faded due to the transfer process when the tape was first made.

I guess that is the good thing about computers now... you can take the VHS and enhance the colors so as to have the saturation you like while retaining the detail that you want (short of the same video being put out in higher definition).