What’s your sequence setting? Are you working in SD resolution?
I got some decent results from a 1080p29.97 sequence. I used the Windows Media Encoder on a PC to make a 1280×720 file at 29.97fps and a data rate of 4Mbps, progressive. Real nice except for a little hitch in the horizontal movement that showed up only inside of PowerPoint. The finished 1280 movie was inserted on the slide using “Insert Movie from File” and set to play automatically and full screen. It looked pretty great on the big screen.
If you’re in SD, you won’t get results that good. The PowerPoint Hi setting is nothing special. It’s about 1200kbps 2-pass VBR in Squeeze on my Mac. If you don’t have 2-pass it’s probably because you have a lower end version of Flip4Mac. With 2-pass peak limited VBR, I usually set quality to 0. That makes the encoder favor motion smoothness over sharpness when the bitrate limit is reached.
I’d go to around 2000kbps for SD. MOst modern PCs handle that with ease and you don’t need much more than that for SD. Low quality deinterlacing is one of the worst problems you face. If you have a high quality deinterlace plug-in for Final Cut (Nattress, e.g.), you’re better off using that before you export for Squeeze.
Are you testing the results of the PowerPOint Hi compression on a Mac? Not a good test. The only good test is a PC and preferably in PowerPoint on the actual show computer. Windows Media on the Mac is often stuttery in my experience. See if you can Google around and find Ben Waggoner’s “Best Practices for Windows Media Encoding.”