I have read the forums and see this same issue arise for many other users.

I see the same standard response:
Computer Monitors look nothing like TV screens.
HDV gets down converted to SD and wont look as sharp and crisp as HD.

As if almost to say - we got what we have and thats the best.

I just find it very hard to believe that with Apple up-selling us on very expensive computers that the end result is one step away from VHS quality!

I have seen Weddings shot on SD cameras with SD tape that look almost like HD when played back on a SD DVD.

How is it that I go from a gorgeous import to a final product that looks like I have a $100.00 camera?

For one thing, you'll never get the high-quality encodes from iDVD to make things look as good as you want. It has nothing to do with what format or camera you originally shot on, it's the over-simplified compression engine used by iDVD.

If you want professional results from your DVD's then you need to be using the pro products and take control over MPEG-2 quality. That means using Compressor 3 for the encoding (or another high-quality encoder such as Telestream's Episode Pro or others) and DVD Studio Pro for the authoring. Yes it's more complex than using consumer-grade applications but the quality of output will astound you compared to iDVD.

Thank you for your advice...

By the way, your listed Mac hardware is the perfect setup for FCS and DVD authoring.