Do you have your project set up the same as the SD video source (720x576 @ 25fps.)? Unfortunately, that camera shoots SD as MPEG2 which is a very lossy format and it does degrade as you re-render it but just a single re-render should not show that much of a loss in quality. Can you post a screen shot of your project properties and render properties? Maybe someone will see something that's not right?
[Lisa Mirtsopoulos]"After importing the raw file (I used Match Media Settings)."
That looks fine.
The Make Movie - Burn to DVD - DVD and Make Movie - MPEG2 - mainconcept mpeg2 - dvdarchitect pal widescreen should give the best quality.
[Lisa Mirtsopoulos]"I do notice that the quality is different again (worse or better) when playing the DVD on a DVD player compared to a computer."
You should always check with a real DVD player. That should give you the actual quality. But remember if you are viewing this on an HD TV that the footage is SD and it's not going to look that great anyway.