Recently Apple TV2G got an Software Update which includes:

TV compatibility:
Addresses issues that may cause the screen to flicker or display incorrect color on some older TVs.

Wake from sleep:
Addresses an issue where Apple TV may not wake up from sleep.

Addresses an issue where audio may not be heard on some TV models after switching from another input.

Stability and performance:
Apple TV Software Update 4.2.1 includes stability and performance fixes for Apple TV.

You can download the new update from here or by choosing Software Update on your Apple TV. The firmware is being seeded as iOS 4.3 build 8F202 but displays version 4.2.1 on the Apple TV.

You can see here on how to Update your Apple TV 2G.