I have some MPEG video I created in a program called "Memories 2 TV". When playing the MPEG alone, it looks great, very smooth. However, once I import the video into Premier, it becomes very choppy. Even after exporting the video (I've tried AVI, MOV and WMA) it still looks really bad when I play it back.
My hardware is a brand new 3.2 Ghz P4 laptop with 1GB Ram and a 64MB video card so I'm hoping that's not the problem. All other video from premier seems to play just fine.
First off, Premiere does not natively support realtime editing of MPEG so you will need to render the timeline before it plays back smoothly in the preview window.
MPEG is also a more lossy and compressed than DV. To this end, and depending on the bitrate of your MPEG video, any subsequent encode will result in a further degredation of quality. Each cycle will by definition be of worse quality.