Seems like the video rca plug is cnnected to the luminance pin on the C64 video connector.
But, it has to be connected to the composite pin !!
Tghe luminance pin is only a b/w signal and is used together with the chrominance pin (colour information), but then you need a cable with 3 rca plugs (luminance, chrominance, audio) and also the correespondng inputs on the TV. This is the best picture quality solution. If your TV accepts s-video then you can also do a cable to a s-video connector or to scart, but the TV has to be able to accepts s-video on the scart input ! Not al can do this as some can only accept composite-video on their scart connector.