After Effects and Encore DVD menu
 

I'm having difficulty trying to figure out a way to have a button that is an image, play a video file (in its place) when highlighted. Is this even possible?

Also, the current menu I'm working on has a video file that plays before the menu pops up (in encore). The problem is there is a pause (black screen) in between the video file and the menu. Is there a way to make this more fluid and seem as though it were a videoclip?

I know it is possible to have a small video clip playing as a part of a button, but I don't know of a way to make it only play when highlighted. There may be some kind of script you can write in After Effects, but I really don't know much about scripting.

As for your second problem, you should be able to apply a transition between your video clip and the main menu. Unfortunately, you need another video file to play as the transition, since Encore won't give you things like dissolves and such. Try creating a separate transition file where you cut 5 seconds off of your opening video clip, and have that dissolve (or whatever you want) into a screenshot of the main menu. There will still be a pause while the DVD player stops playing the video to access the menu, but it should appear a little smoother on the playback end.

You may be able to make it more fluid. But it will not likely be possible to make the pause go away completely. That's because the pause is mechanical. It's the DVD player repositioning its head to read the next file.

You'll really notice this if, for example, you add music to a menu. You'd think that it would just loop, but it won't. It plays to the end, then you get a pause while the DVD player repositions it's head and starts the menu over "from the beginning" as it were. During that time (a second or two) there's no music, and the menu buttons can't be accessed. I doubt you can get this kind of pause to go away because the level of buffering that would be required is beyond the capacity of the typical dirt cheap DVD player.

The answer then is to plan for it. This is why menus with music typically use music clips that are in the range of 45-60 seconds -- anything shorter makes the "flaws" just too obvious. And yes, I found this out the hard way too. ;-)