I have one last questions and that is… what are you trying to do?
If I understand correctly, you have an MPEG file that you got from a Standard Definition DVD which contains interlaced video. You are loading it into a Hi Definition project that is progressive scan. You are then rendering it to a Standard Definition DVD that is interlaced. This flip-flopping between interlaced and progressive is what’s causing your problem. I’m not even sure why you are using HD at all.
My advice is to set your project properties to match both your source footage and output format which is NTSC DV Widescreen. Then edit and render to NTSC DVD Widescreen and everything should look fine. Don’t change any of the default settings for the project or render.
~jr
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