H264 file conversion for use in DVDit on PC for Blu-Ray Disc Burn

We're trying to create our first Blu-Ray HD disc project and have met with some success. The problem is the frame update rate on the Blu-Ray during playback. It's not real time. Here's the workflow that we created since FCP doesn't support Blu-Ray yet. We're taking the original animation source footage created in AVI with the following specs: progressive, 1280x720. 59.94, 158 mb/s and importing into FCP. Then, after editing we export an H264 out of Compressor with these specs: progressive, 1280x720. 59.94, 16 mb/s. We then take that H264 file to DVDit on the PC and author the Blu-Ray disc. The resolution of the video is fantastic but the frame rate lags at certain areas. This is unacceptable to the client so we're trying to fix the problem. Any Ideas or better workflow? Thanks.
Power Mac G5, CPU:2, Speed: 2.7 GHz, RAM: 2 Gig, Bus Speed: 1.35 GHz   Mac OS X (10.4.9)  

Hi Video Dude
here's a good article I posted on the DVDSP forum as well. It tells a bunch about workflow and the problems the author faced. I hope you know that this is kind of a new technology - so much so that I would frankly say it's in the beta stanges at this point even though you can buy players and authoring software - problems might come up that you have no control at this point. Just so you & your client relize this. Check for plyer updates as well.
Good Luck
http://www.dv.com/features/features_item.php?articleId=196602808

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