For your information, where u shoot the pic? issit a fine sunny day? or indoor? inside ur room? coz 3.2megapixel, even indoor or less sunlight, the quality will be not good lo 

Try to capture pic at a very fine sunnyday + good sunlight , if ur images still grainy means ...i oso dunno liaw 

Like what saber said, lighting plays an important role as well. You got to see where are you snapping those pictures. If in a room lighting... pictures taken may be grainy and blur. But if you were to compare picture taken outdoor with normal sunlight... that's gonna be a huge difference on it