HDV to SD

OK folks, I'm in a sort of limbo with delivering HD from a Mac at the moment so until something reliable comes along I'm converting my HDV to SD, then to SD DVDs and recently had to cover a major fire for a company of Loss Adjusters. There was a lot of structural elements involved, lots of steelwork, concrete, skylines, windows etc. Shot it all interlaced, imported it 'correctly' into FCP and exported it using compressor to SD , burned a DVD and was quite disappointed with the quality.
The export was at the deafult bitrate and I'm not blaming that for the results as i've done some really HQ SD DVDs using this process but they've always been shot progressive. This is the first actual job I've shot interlaced.
Upon scrutinizing the footage on the timeline on a HD monitor at 200% it is visibly interlace on every vertical, diagonal edge in the movie giving a fuzzy appearance.
I'd expect interlaced footage to appear interlaced on a computer but then it's supposed to display cleanly when presented from a TV, Right ??
Is the poor quality of the DVD down to me donconverting Interlaced footage from HDV to SD. Does 'progressive' HDV footage downconvert cleaner?
Peter