Are your trying to upconvert your SD material to HD?
Can you capture SD-DV.
Edit SD-DV.
THEN, Change your sequence to the DV50 codec? Or 8 bit Uncompressed.
Then Export Current settings.
I don’t use FCE, So I don’t know how much like FCP it is.
OR
Can you capture SD-DV.
Edit SD-DV.
Export finished edit using a better codec.
Then compress for dvd.
Chris Tompkins
Video Atlanta LLC