I was shooting in the 60i mode, and setting my Vegas project up as interlaced for the purpose of producing a DVD. I was getting horrible looking results. Inquired about this on another forum and one of the well-respected gurus there had me send him a piece of the raw footage from the camcorder. After he analyzed the footage, he guaranteed that the footage was progressive and said:
"The field order reported by the video header, which is what you see in Vegas, means absolutely nothing. You should always check by frameserving into a simple AVISynth script that is nothing more than "separatefields().""
Someone else apparently figured this out as well in a past review:
http://www.sierradescents.com/reviews/canon/xa10.html : "Why the change of heart? In part, it's because I initially mis-processed XA10 footage in my editing software. That's an easy mistake to make: the XA10 shoots progressive footage but encloses it in a standard 60i AVCHD wrapper. If you're not careful, your editing software can easily mistake the footage for actual interlaced video, consequently doing subtle but noticeable damage to image quality."
I contacted Canon just now and the guy said this is the first call he's had about someone saying the 60i interlaced mode footage is actually progressive. Most of the confusion is about the PF30 mode which isn't true progressive. I'm not a pro with any of this stuff. I just know that when I told Vegas that the source footage was progressive, the end result was much better.