Placing Illustrator shapes in Photoshop

I have followed the instructions on adobe's pages about placing illustrator files and shapes into photoshop but I am still getting a pixelation of the AI shape or element once it's been placed as a smart object.
Any suggestions on what I am doing wrong? I am running out of time for my class asisgnment due tomorrow.
thanks!

Try this video. The other one shows how to create your problem rather than solve it.
http://www.youtube.com/watch?v=jSgUuzqZpC8&feature=related

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