So I tried the second one (http://jpx72.detailne.sk/modd_files/fc/avmod.htm) and it worked.
I tried it on my breadboard first:
I didn't solder the caps to PPU and CPU as the tutorial required and didn't cut the trace to pin 21. I just wanted to test the concept and to my surprise the picture was pretty good. So called "jail bars" were barely noticeable.
I took GND and +5V directly from the voltage regulator (you can check 7805 datasheet to know which pin is which).
Now 3 things are left to do:
1. RCA sound mod
2. Finish the AV mod (add the caps)
3. Drill the holes in the housing shell for RCA jacks (not sure yet where to put them).
I wonder how hard would it be to preserve the RF signal also...