Hi Thanks for the comment..
I discovered a few things in my nightmare process.
1, this is a mac issue… (hate to say it) FYI .. I am on Leopard 10.5.2 and encore 8.02, which was meant to correct leopard issues.
So I took my project over to a windows machine… Nice to know that the project files from mac to windows and vice versa do not open..!!
So after re building the DVD the windows version did not have the highlight issue…So job completed, but come on adobe!