I have recently encoded an svcd from a divx source. The only thing I changed in TMPG was the encoding quality and the VBR (300-2520 kb/s). I got an SVCD that looks really good. I thought divx sources were supposed to look bad when going to svcd most of the time. The divx was your average one, nothing special. Im not talking DVD quality, but then again, no one can get that. It was a good SVCD.