VHS captures... Deinterlace Interlace

[LanEvo7]

I know this topic has been talked about many times and with very lengthy discussions, but here it is again.

I am turning some VHS tapes into digital format, using either MPEG2 or MPEG4(divx/xvid). Right now I have a regular NTSC TV and I know I should leave the video interlaced. But considering that TVs are heading the way of progressive should I deinterlace in preperation for the future? Or do progressive TVs have an internal method to deinterlace interlaced video?
I'm pretty sure these videos are not teleclined because I've tried to deinterlace it using inverse telecline method and the video doesn't flow after its been deinterlaced.

Another question, when I encode my video to interlaced MPEG2 it plays fine on my computer screen when using WinDVD(ie no viewable interlaced lines). I'm assuming this is because WinDVD has an internal method of deinterlacing the video. When I encode to interlaced MPEG4 however, the interlaced lines are clearly visible. I've tried playing them with wmp, windvd and nero showtime. Is there anyway to fix this?

[SaSi]

I am surely not the expert on this topic, but having spent (perhaps wasted) several hours trying to de-interlace, here it goes.

I think that interlaced video that did not originate from film cannot actually be de-interlaced. If it was originally filmed on video, the video camera takes twice as much fields as the frame rate per second, each one containing a part of the motion. So, if you combine two interlaced fields into a single one, panning motion will show up badly.

I believe it makes sense only to de-interlace DVD material originating from film that was progressive and then converted to interlaced.

However, even that may be a waste, as - I've read on a HiFi magazine - new progressive capable displays like plasma, are able to de-interlace the video signal.

Additionally, even my most succesful attempts to de-interlace video showed up badly on interlaced TV. Only the PC was able to playback panning motion smoothly. On TV, I could not bare it for seconds - it made me sick.

[LanEvo7]

I'm not sure the videos are originating from film. These videos are foreign TV shows, not american movies. It is a professsional production though so I figured that there is a chance that it was shot in film. I used the inverse telecine filter in virtual dub, but the video doesn't flow. Maybe i should try the one using Avisynth.

I do plan to view the final result on a TV though.