FINAL CUT EXPRESS 4.01 - losing quality while exporting to file

Hey guys,
I'm dealin with a basic problem, which has been probably reviewed before, but just wanted to present my personal issue with it, and wonder if anyone could help me with this.
I shot clips with Canon 550d (1920x1080 30fps) and then converted them with Mpegstreamclip using Apple Intermediate Codec to 1280x720 30fps (however which also concerns me, in the browser i can see that they're 1280x720, but on the timeline after clicking Item properties, they are clearly 1920x1080). Easy Setup is set to HDV-Apple Intermediate Codec 720p 30 (maybe that's the part i'm doing wrong).
The thing is, it looks perfect, sharp and smooth on the canvas, but after exporting it loses it's depth of colours and sharpness etc.
Settings I'm using for exporting are those suggested f.e. by Vimeo site:
Compression: H264
Frame Rate: Current
Key Frames: every 30
Data Rate: limited to 5000kbps
Size: HD 1280x720 16:9 (tried also with 1280x720 HD but seems the same naturally)
Frame Reordering - ticked (it's done automatically, should i untick it?)
Mac details: Mac OS X 10.6.8, 2 GHz Intel Core 2 Duo / 2,5 GB 667 Mhz DDR2 SDRAM
You can check the result here:
http://vimeo.com/32730130
or
http://www.youtube.com/watch?v=UsEednjpcQk&hd=1
I'm really looking forward to any tips that can help. Thank You very very much:)

Use *MPEG Streamclip* to convert the MPEG2 files to QuickTime using Apple Intermediate Codec. However, if you shot 4:3 video then you may have to convert the video to QuickTime using Apple DV/DVCPRO-NTSC instead of Apple Intermediate Codec. These are selections you make in MPEG Streamclip. (Your camera can record video as 4:3 or 16:9 standard def but there is precious little information about its 16:9 mode. You may have to play around with some of the settings in MPEG Streamclip.) Once you have converted the files, you will import the converted files into FCE (FCE > File > Import > Files).
Do note, however that you also need to have the *QuickTime MPEG2 Playback Component* installed on your Mac. You may need to buy it if you don't already have it. (Links provided in my previous post.)
QuickTime7 Pro is not the app you need to do this conversion.

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2) "One field is DISCARDED with 1080i." Not true. IF AND ONLY IF you use a function or FX that performs scaling, ALL video is chopped to 540p.
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FINAL CUT EXPRESS 4.01 - losing quality while exporting to file

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