We have been having a problem with the quality of our bluray menus in Encore DVD.
We are still working with final cut pro so our workflow is to export our Bluray assets through compressor in a Bluray transcoded format and import them into Encore DVD. Videos playing on timelines come out crystal clear but any motion video menus appears to look de-interlaced/very low quality.
I did a test by linking a normal video to be used in a timeline to a motion menu and it too appeared in a lower quality. It seems like any video used in a menu plays at half quality.
The only way to actually verify the result is by burning a Bluray and watching it on a player because the loss of quality is not seeing during the preview.