Why is the animation so gritty?

Maybe different animators? I'm not sure

As time goes on, the staff members of almost all television shows start to find their voices. Characters take on definition. The writing improves (and sometimes it gets worse). Just look at the first season of The Simpsons, and then look at season five (no higher, because the quality starts to sag). It was weird at first, but they found their voice.

Night Watch/Day Watch fan site - http://www.intothegloom.com/

I know what you mean. I was thinking the entire time I was watching this how terrible it looked compared to the regular seasons. And the Nickelodeon movies that were made around the same time all look spectacular. Like The Wild Thornberrys Movie, that looked damn spectacular.

The animation was whack. They had these unusual white outline hightlights. It was distracting.

Not only that, it was a lot more...cartoony? Like no *beep* it's a cartoon, but it had a lot of stuff that didn't mesh with the entire series (for instance the whole Big Bob beating that guy up sequence comes right to mind).
It just looked different and really just...sort of ruined it to be honest. In my head this is not part of the Hey Arnold sequence of events.

I agree. The colors looked so washed out and dried.

"Arnold, my love, why must I worship you...and NEVER EVER tell?" 