I came acroos another thread that seems to solve the problem:
Run the renderered AVCHD file through tsMuxeR and output as M2Ts. The file now plays smoothly with audio in sync (over 20 minutes long.
My panasonic avchd lite video was flickering with vegas pro 9c. I downgraded to Vegas 9b and the flicker is gone (in both preview and after rendering).