It would be pretty simple to test bitrate difference as well. You could encode a short section at a higher bitrate and see if it looks better.

Just a thought, but when you drop the clip into compressor and it becomes an icon at the top, click on it. When its information is in the inspector window, what is "Native Field Dominance" set to? I had a problem when I first started using Compressor and didn't notice that it defaulted to "Top First". When I changed it to "Progressive", things started looking better. Just thought I would toss that out there.

Thanks for the responses guys. I am away from my editing maching for a few days and will be back at it this weekend. In the meantime, a couple of things I am investigating revolving around this topic:

This footage is 1080p30 AVCHD from an HMC150. What I am then putting on DVD is 480p30 (29.97 fps progressive). I have heard that DVD needs to be either 480p24 or else 480i30, but have not found any mention anywhere of a progressive 30 frame DVD. It certainly plays fine on the DVD players I am testing on (one outputting S-video, one is composite), but I suspect that they are interlacing it. On my upconverting player going to a 720p LCD TV via HDMI, I have been happy with the result on previous projects. That player quit on me, but regardless, my customers will more than likely be using players with composite output. I think it will be some time before those go away.

So, is SD (480 lines NTSC) in 29.97 progressive a legitmate format on DVD?

I have it set to source (which is progressive) if recall my settings correctly, but I will double check that when I get back.

i60. There is no i30.

Yes, SD at 29.97 is an acceptable (and probably the most common in NTSC land) DVD format.

Yes, but is SD in progressive (not interlaced) 29.97 OK or typical as well? I see mention all over of interlaced 29.97 or progressive 23.98.

SD progressive 30p is split into a 60i signal normally for video equipment. You won't see a difference.

Compressor and ac3
 

I wonder why my DVD Studio pro (Macbook Pro with SL and the new FCS) doesn't like the audio files ac3. I have used the start pop up menu option to make DVD's and I also have used the DVD settings in the settings tab. I have tried both HD and SD footage. I am making just a regular DVD. Any thoughts? Thanks