HELP! Premiere Elements 10 Video Exporting

Hi,
I'm a new PrElements 10 user, and I am on deadline and need some help, thanks! I'm new to video so talk any help getting me through this is appreciated.
Here's the description of the project:
++ I'm making a cartoon video and am using CS5 with Premiere Elements 5.
++ It is for internet use: website, social media, YouTube.
++ I'm by importing jpegs made from .ai files in CS5. I'm not NOT shooting video or importing video into the project.
++ I'm giving the jpegs the appearance of animation by treating them through the use of FX, transitions, etc. I'm not using AfterEffects, so I cannot create animations that way.
++ The .ai files are sized in widescreen 16:9 at pixel size 800 x 450.
++ The jpegs were exported from these files with the resolution settings: 5 and 425 ppi.
I mocked up a short video using some of the jpegs to make sure the settings were right before I did the whole project. Here are the problems I'm having:
1.) the exported video is not showing in Widescreen. The video is goes all the way to the top and bottom of the screen but the ends are squashed in so the content and characters are distorted to appear taller and thinner than they should.
2.) when i change the export settings, some of them correct the problem and some of them don't. This export preset works to get it into Widescreen but the file size is huge: "MP4-H264 1920*1080p 24".
3. Which brings me to compression. Does PrE have compression to resolve this issue- is it in one of the presets- what compression should I be using? Or do I have to buy a compression program? If so, what do you recommend?
4.) Project Set-up: Is this where I went wrong? Which preset should I be using for this jpeg-driven project? How does that Project Preset affect the input settings and output settings? And should I be using jpegs or tiffs or native .ai files???
5) My project preset is HD 1080i. Is this present affecting this exporting result?
Thanks!

You will find best advice over on the video forum. Most of us here are photographers.
Click on the link below and copy and paste your question again. Good luck.
Video questions: Click here for Premiere Elements Forum

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