First of all, converting or transcoding an compressed video to an uncompressed format doesn’t increase the quality, it merely gives you an uncompressed file of the same data that was in the compressed version.
We’ve been remiss in asking what your comp’s size is? If you are placing a 720 x 480 image into a 1080 comp and making the image match the comp, you’re asking for a lot of pixelation.
Another thought, what is your Resolution/Down Sample Factor set for the comp viewer?
Steve Brame
creative illusions Productions