Pls help im losing my f---ing mind

[]TNT[]

Hi i have done captures from dtv for a while now they have all been pretty good result in svcd but now i want my final files to end up as divx and am having a little bit of problems. Can someone tell me because of the interlace in dish should I capture high and resize to lower to get rid of my interlace or use vertical reduction lets say at 640x480 making it 640x240 and resize up to 640x352 or how can i avoid the interlacing all together, I'm ending up with sort of smoothed out, almost blurred images and im looking i guess for a more sharp clean picture. Anyone who can share their tips and secrets including codecs used, resolution yuy2 format or rgb24 etc would be much appreciated and i'm sure would help out other users here as well, as all i ever here about it capping to go to vcd or svcd.
Ps perhaps there is a good filter someone can recommend as well that will make my video look more glassy rather then dull and blunt. I know perhaps some people can not answer all of this but any little bit of help would be much appreciated.
Not sure if this matters but here is my setup
Hauppauge wintv go
amd xp 2100
512m
40 gigs of free space to play with
using Vdub(don't mind switching if it will help my cause)
Thanks in advance

[KKDFOS]

Use the deinterlace filter in Vdub using the blend method,There is a slight loss of sharpness but its better than resizing.

[]TNT[]

Thank you much, as well does anyone know what color settings i should use to acheive a nicer look to my caps with my card

[KKDFOS]

I have an ATI tv wonder using third party bt drivers.I use Iuvcr to capture in YUY2 at 640x480 in Mjpeg. Audio is captured in mp3.This capture is then opened in Vdub ,filtered using deinterlace(blend) ,cropping,temporal smoother(4) and compressed using two pass Xvid.
If the capture is out of sync with audio I just fiddle with the frame rate (divx?xvid doesn't require exactly 25fps for pal),usually setting change video framerate to match audio does the trick.