I am a bit perplexed about what settings I should use when outputting a master file to burn a DVD with other software to be used as a screener.
prores422 or h.264 or what? I know the DVD will be compressed into about 3 or 4 GB, but the prores422 setting makes a file of about 72GB while H.264 will make one about 11GB. Does this have an impact on the quality of the the DVD in the end?
If you're just doing screeners, first try the X built in Share preset for DVDs. The authoring is rudimentary, but I've found the results very good.
If you want more control, send to Compressor and you can tweak the settings, but the Compressor presets will insure that your output is DVD spec friendly.
That's the most important thing for ensuring universal player compatibility.
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Using the highest quality master is always your best choice, yes. I.e. the ProRes.
I simply use either FCP's built in DVD output or iDVD if I need more options. Both of which will compress the master file to the best quality (size) possible relative to the amount of space available on the given DVD-R.