Using native timeline from beautiful Canon XF300 footage. I export as a Quicktime movie (full HD). Is there a best down-conversion method to SD such that the SD looks decent (that is, doesn't have those weird jagged edges/wrinkled edges with certain shots)?

The color quality is still beautiful (and better than typical SD footage), but the lines are not as good as if I had just started with SD footage.

I guess what I'm asking is: is there a tried and true HD-SD workflow via Final Cut Pro 7, and/or compressor, and or save-to-quicktime that I'm missing?

Yes, and this topic has been covered in depth numerous times. I believe the master thread is located in the FCP area of this forum, but it's been some time since I referenced it.

I believe the answer you seek is in "Frame controls" in Compressor, but I am not an FCP user so I don't remember exactly where everything was.

Perrone is correct. You can turn on the Frame controls in Compressor to control how the downconversion is done. You can choose how to treat the incoming & outgoing fields and how scaling is done.

I'd recommend that you run some tests using different combinations and save the best result as a droplet.

Thanks so much, guys.

I hadn't had luck finding the exact thread that worked and "frame controls" was the missing ingredient, indeed.

Thanks again.