I am converting MiniDV tapes (AVI format) and burning to Blu-ray Disc using Roxio Creator NXT2. What format do I chose for the best possible picture quality?
Also, what is the difference between Blu-ray HQ and Blu-ray AVCHD?
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You have 2 choices:
1. Leave the resolution alone and create an SD-sized title in Blu-ray. This is the equivalent of DVD-Video but just stored on a BD disc using AVC codec instead of MPEG2. So you encode in SD (4:3 or 16:9, as per your DV tape), and author & burn. Upon playback, the BD player will upscale to fit the resolution of your screen (usually 1920x1080 16:9).
2. Upscale the resolution now and create an HD-sized title in Blu-ray. Encode, author & burn. Upon playback, the BD player will not need to upscale (unless you have a non-standard size TV).
With the first you leave the upscaling to the BDplayer/TV, with the second you do that ahead of time.
Which one you choose will depend on: time & energy you want to spend doing the upscaling yourself, the relative merit of the player/TV upscalers vs. the merit of the upscaler you choose when doing it yourself (there can be a number of methods, some better some worse).
IIWY, I'd choose the former. You are starting out with SD resolution, so your "true" detail is never really going to be HD even if you are using all of HD's pixels. Also, if you upscale first, you are having to spread out your bitrate to handle MORE pixels than if just encoding the SD, meaning your SD can have less artifacts.
Blu-ray HQ makes a high quality Blu-ray. Blu-ray AVCHD makes a ? quality AVCHD. While the 2 are related, Blu-ray is NOT the same as AVCHD. It makes sense to use AVCHD if, for example, your home camera created its images in AVCHD format natively. Then you wouldn't even need to re-encode, so you could retain the original cam's quality through to the disc playback. But AVCHD format usually only works for players that support it - it has to expressly state that AVCHD is supported. "Blu-ray" should be supported in any Blu-ray player (naturally).