PAL and NTSC are both formats of analogue video. In essence, PAL is 625 vertical lines at an aspect ration of 4:3 (as it is analogue, there is no fixed horizontal resolution, but rather this depends on the TV) while NTSC is lower, typically 525 line.
However, these names also refer to the signal standard for composite (single cable) signal transmission, as you would effectively get from a terrestrial analogue transmitter.
In addition to your TV needing to cope with these signal types, it may also need to cope with a variety of means of receiving the signal, such as direct antenna feed (via a demodulator, or tuner), composite video cable (your red, white and yellow – the video signal is on the yellow, with the stereo audio channels on the red and white), component video (or Y/C which separates the monochrome brightness from the colour as in the original PAL format) and RGB. The SCART connector supports all three of these, and they are not always wired in.
In essence, the more wires the signal is carried over, the higher the horizontal resolution (limited to the native PAL resolution of 625 lines per picture height). Therefore, RGB is best and you need to make sure you have an RGB wired SCART cable.
You also need to make sure you have an RGB wired SCART socket on the TV. Typically, older Sony TVs only wired SCART 1 for RGB, and there is a setting on the menu to use this.
As an aside, almost all modern (from mid-90s ish onwards) TVs can handle either PAL or NTSC (it makes for lower manufacturing costs).
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