also, if you are talking about the preview window, before you save the final
movie, then YES it is crappy. it is just a preview and will not reflect the
final outcome. if you start with high-res pictures and save your final
movie in a high quality mode, you will get good results.
Movie Maker resizes all photos to the size of the frames in output video.
Therefore to achieve best resolution you need to select a high resolution
output video format. I think maximum you can get is 720x576. Unfortunately
the resize method used in Movie Maker is not very satisfactory... On the
other hand the resize method used in PhotStory2 is very good and therefore
there is a marked difference in their output.