Billy,
To find out the requested information, right click on the raster and select properties. You will see Pixel Depth listed, which will tell you if its 1 bit, 8 bit, etc. While you are checking that, please check and see what kind of compression you have.
Paul,
If you look in Windows Explorer does your raster have .rrd or .ovr file? If a .rrd file, try renaming it, and then build pyramids, and see if that changes the display as you zoom in.
Patrick