Surely DVD should be better.
However DV AVI may not be the most appropriate for still image slideshows.
In my experiments a WMV with any moderate bitrate (1.5Mbps + ) but with
output size 640x480 came out to be better than DV AVI.
DV AVI uses non-squre pixel encoding to expand/compress any size image into
720x480. This would cause stretching in input square pixels thus introducing
some artifacts. This artifact does not apply to video footage which is
already encoded in such format (such as a capture from camcorder).
Try a 640x480 WMV output format with your images resized to 640x480 using a
good image package. You may like to use the custom output profiles of sizes
800x600 and 1024x768 from
www.papjohn.org site. In which case resize your
input images to that size. The idea is to match the input size and ratio to
the output size and ratio.
Then use the WMV movie to encode into MPEG2 using TMPGenc. TMPGenc also has
to resample the frame to 720x480 but it does it with good quality algorithms
so the quality does not suffer that much. Use multi pass vbr mode rather
than CBR for better quality from TMpGenc.