Creating higher quality dvd files

So here is my scenario : I am currently working on a project where the finished output is going to be DVD Video_TS folders. However, I am not going to be burning to a disc but taking the files to a flash drive to be able to be played off of the flash drive, thus I have way more space than any dvd would have. The situation I have ran into is that when I create the video_ts files it is squashing my quality significantly. I know this is because it is taking HD quality video and making it able to fit on a DVD. My question is this: Is there anyway on Encore to make the resolution of the transcode higher, almost to blu ray quality, while keeping the end point a video_ts folder? I have tried to write a BDMV file and play it back with VLC, which is what I am telling the clients to use to open this file, but it does not behave in a way that would allow the menus to work. trying to open those files in VLC player doesn't give me the end point I want. And I haven't been able to get VLC to play a BDMV file with menus and everything. If anyone can point me in the right direction on what to do I would greatly appreciate it. Thanks!

DVD is ALWAYS standard-definition (NTSC or PAL), there is no way to increase the resolution. You can increase the encoded quality using various methods/workflows while staying within the DVD spec.
Just read an interesting post the other day by a wedding videographer that is delivering his videos on a USB drive as .mp4 video, WITH menus/navigation. He is making some sort of Flash or HTML script that is included on the drive, don't know the details, but perhaps something like that would suit your needs, allowing HD video?
Thanks

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