Need advice on a workflow (mixing HD and SD on Final Cut timeline)

Hi
I'd love some help with the following. Thanks in advance.
I have shot full HD 1920 x 1080 24P PAL footage with the Canon 7D. I have also shot SD footage with the Canon XL2 (16:9, PAL, 50i).
I am using Final Cut Studio (Final Cut Pro 7). I am running FCPro 7 on a MacBook Pro and a Mac Pro (both intel).
What is the best set up (audio/visual set up) in Final Cut, before I bring in the footage? There are so many different set ups. When I export, how do I export? What settings do I use? If I want to export using compressor, what should I do in there? If I want to just make a simple DVD in iDVD, what do I export as from FCPro?
In the end, I want a high quality DVD. I realize I can't do a Blu-Ray disc because some of the footage is SD.
What is the best work flow? Thanks very much for the help. I really appreciate it.

interdiscipline wrote:
Here's the configuration we're considering:
Processor: Two 3.2GHz Quad-Core Intel Xeon (8-core)
*Don't do it!* Stick with the dual-2.8GHz config. A jump from that to the dual-3.2GHz gains you only an approximate 9% increase in power at a 52% increase in cost! Not worth it all. That money is much wiser spent on RAM, RAID array, or a broadcast monitor.
Memory: 16GB (4 x 4GB)
Hard Drives: 300GB 15,000-rpm SAS (for OS X, Final Cut, & other programs) plus 2 x 1TB 7200-rpm Serial ATA 3Gb/s (for video storage)
Graphics: NVIDIA Quadro FX 5600
We're thinking about spending the extra $1600 to get the best processor available, since we want this machine to be the hub of the business for about five years.
The processor is only one part of the whole, and as I just mentioned, the power:cost benefits are not good.
The graphics card is where we're most torn - specifically between the Quadro 5600, the GeForce 8800, or perhaps even getting the computer with the standard card (or no card) and getting a different third-party card. We do mostly DV now, but we foresee doing HD projects in the future.
Quadro 5600 is pricey, but I'm not sure about its benefits for people in our field. Even if I had the money for it, I would be hard pressed to consider it considering, again, money is liekly wiser spent elsewhere.
Also, it looks like we're gonna buy Final Cut Studio 2 and are considering also getting Final Cut Server. It seems the combination would allows us to use the Final Cut suite on other computers (both Mac and Wintel) that don't have their own version of Final Cut installed. Is that the correct interpretation?
I don't know much about FCServer, but my impression is that it is -- simply speaking -- Final Cut version of Avid Unity. In other words, I am pretty certain that your understanding on that is false. I may be wrong.

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