I've been playing with CCE 2.62, I tried to convert DivX (3) to MPEG1/2 (tried both).
1) I make a AVS-script and used VFAPI on it.
2) opened the vfapi in CCE
3) set mpeg-1 CBR (only option under MPEG1?) at 1150kbps
3b) Tried Mpeg-2 VBR aver=1150kbps max=1536kbps min=512kbps

Crappy result looking like there is missing some colours and like in was made by tmpgenc with worst quality setting.

my "script"
-----------------------------------
AVISource("filepath\name")
BiCubicResize(352,290)
Crop(0,2,352,290)
CropBottom(2)
ChangeFPS(25)
-----------------------------------

Source was a DivX3 352x240@29,97fps. Length 44m 16s

CCE standard settings overall.

I've also tried to "convert" the first 2 min to uncompressed AVI, more or less the same result.

How do I set CCE up to make better quality pictures?

My system:
AMD Duron 700mhz
384mb sdram
Geforce2 mx
M$ Winblows 2000