DVDSP and Live Type

I have a Menu Background created in Live Type that has some text effects and a texture background. I imported the Live Type file (.ipr) to DVDSP, set it as my menu background and added a "Play Video" button. In Live Type when you "play" the file its sharp, clear and fonts are smooth. When I play the Menu created with this file in DVDSP, the fonts are all "jiggy-jaggy" in both the viewer and the simulator.
Live Type file was created with NTSC 4:3 as the preference preset
DVDSP is set at NTSC and 4:3 display mode
I am at a loss as to how to correct this so the menu will display the same in both apps. I am new to FCSPro - so bear with me if this is something simple and stupid!
iMac 24 Intel Core 2 Duo   Mac OS X (10.4.8)  

Neither simple nor stupid...
Try exporting the footage out of live type as a .mov file and using that as your menu background. You can then add the 'Play' button and when the disc is built it should all get encoded to MPEG2.
I think the issue is how the live type file is being read - I have certainly been in the same position before and found that by using .mov from LT it all seemed much better.
You could also add the 'Play Video' text to the background in LT, then use a simple overlay made in photoshop to give you a button highlight (a single button on a menu will be selected by default as the menu plays, so the highlight would always show). If you do this then you can use QT to encode the background footage to MPEG2 and then use that as your menu... don't add any other items from the palette though, or else the background footage will get encoded a second time by DVDSP and look pretty bad.

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