AVI is not “lossless.” AVI is just a container like Quicktime. All it does is store your video/audio, and present it to players that recognize the AVI format. Within the AVI file, your video is compressed with a particular codec that the AVI format supports, such as Divx or Uncompressed. It is the codec you decide to use within the AVI file that determines the quality, and you probably are using a really crappy codec instead of uncompressed.
If you aren’t using the render queue (that is, if you are using the File>Export option) you need to start using the render queue (Composition>Add To Render Queue). Beyond that, you need to explore the various codec and quality settings once you select AVI as your output container format, and you will find what you need. If you don’t know enough about codecs to decide which is the best option for your needs, search Google for something like “AVI codec options” until you find what you need.
Brendan Coots
Splitvision Digital
http://www.splitvisiondigital.com