I think I finally figured out how to render Sony CX7’s AVCHD files for the web and keep the resulting file size at minimum. The trick is to convert AVCHD files to MPEG-2 using Picture Motion Browser software first. Next, edit MPEG-2’s in Vegas Pro and render the final project as WMV at 1 Mbps. The resulting file is small and quality is almost as good as the source MPEG-2.
I’ve tried working directly with AVCHD files in Vegas then converting them to WMV but the result is horrible IQ. I also tried rendering AVCHD as MPEG-2 in Vegas Pro but I can’t match the quality I get from Picture Motion Browser “Convert to MPEG-2 and Save” option.
The process adds additional overhead to the post processing workflow but I am willing to deal with it — the resulting quality is worth it.