Unfortunately, the stutter is caused by the fact that you have multiple objects crossing, and I presume that the arm is hiding a “decent” amount from one frame to the next… and the part is either becoming obscured or unobscured in the next frame. So what’s Twixtor to do (remember it’s working on 2d pixels only).
Well, it can either “gloop” pixels together. Which causes a bit of a wavy action in the background pixels if the foreground pixels are tracked properly. The other thing Twixtor can do is miss that the foreground pixels match up between frames, causing a stutter (or frame blending result).
The answer, unfortunately, is to use Twixtor Pro and provide a matte for the foreground elements (something that needs to be created frame by frame). You can see a tutorial on that here: https://library.creativecow.net/freitag_lori/Twixtor-Better-retiming-with-matte/1
Then if that’s not enough, you can use tracking points that you manually animate to follow the motion of parts that aren’t tracked well: https://library.creativecow.net/freitag_lori/Twixtor-Tracking-Points/1
You can also use splines if you have AE to also guide parts of the image in lieu of tracking points.
You might also want to read this: https://revisionfx.com/support/faqs/generalfaqs/how_do_i_get_the_most_out_of_twixtor/ . However, the parts of that FAQ that are most relevant are already covered in my post above.
Pete Litwinowicz
RE:Vision Effects, Inc.