Artifacts/Interlacing Issues...
 

I'm new to HDV editing and am using Vegas 7 and a Sony HDR-FX1 Camera capturing in 1080i HDV. I'm having a problem in that whatever video format I render to is showing what looks to be horizontal lines or interlacing issues whenever there is any movement in the video. So when somebody moves their arm say up to their head, you can see jagged edges until their arm comes to a stop and then everything looks alright.

I've seen this before and thought it had something to do with the field order, but I'm not sure.

My workflow is as follows..

Start Vegas... Start a new Project wtih the following settings..

HDV 1080-60i template (1440X1080, 29.970 fps)
Field Order: upper field first
PAR: 1.333 (HDV 1080)
Frame Rate: 29.970 NTSC

Full-resolution rentering quality: Best
Motion blur type: Gaussian
Deinterlace method: None (I've switched this to blend fields & interpolate fields with no success).

I import my video which I should believe matches those setting and am trying to export WMV9, MPeg2, etc, etc and no luck. Always the issue there.

Any thoughts or suggestins?