Small video problem with TMPGEnc

[DRA]

I am still playing wiht the settings for this program to convert a video file to MPEG2 for SVCD, and I think I'm getting the hang of things but I have small problem.

The resulting MPEG2 file (converted from DIVX) has some colored pixels around the edge of the widescreen film. Most stay in the black but it is very distracting. Any idea as to what I may be doing wrong? Here are the settings I used (I used the project wizard):

NTSC Film
Video Type: Non-Interlace
Aspect Ratio: 1:1 VGA
Rate control mode: 2 Pass VBR
Motion Search: High Quality
Video arrange method: Full Screen(keep aspect ratio)

And it also automatically checked the box for Inverse Telecine. When unchecked, the movie became horribly choppy so I left it on.

Also, sometimes in converting I get an illegal decimal point error. Even though the audio is perfectly in sync, would this mean that I should export the audio to WAV first, as it says in the problems section on this site? Direct Show is already at the top of the list in my Environmental settings.

Thank for any suggestions you guys may have!

[wee haggis]

I extract audio as WAV with all DIVX files before encoding
but
If its a XVID ,I feed it directly into TMPGEnc

[DRA]

Ok, extracting the auio as wav didn't help, neither did changing any settings. I'm not sure what to do about this error, I've fixed the picture quality but the error occurs every time. I've used all this sites resources on the subject, does anyone have a solution?