Rendering to AME is definitely a good route. I do animation, so everything I render out of AE is typically an image sequence, then I place that in Premiere where I mix the sound together with any watermarks and stuff. Once it’s all setup, then I export it out of Premiere using the same codec and compression settings I would in AME.
In your case, it sounds like you’ve just set your bit rate too low. If I’m rendering 1080p, I usually go with H264 at 10 or 15mbps depending on what I’m rendering. If there are textures, gradients, etc, I go with 15. It’s not a magic number, and you should definitely experiment with different data rates to get the best render for your needs, but that’s what I typically start with.
Jason Jantzen
vimeo.com/jasonj