Using Adobe Media Encoder CS4 for MTS files

Hey everyone, I did some searching on this topic to no avail so here I am.
Anyway, I recently got an HD camcorder that records in 1080i AVCHD.
I have no problems getting the MTS files off of my camera but as I'm sure you can imagine, working with those files is a whole other issue.
I've found that Adobe Media Encoder CS4 works great in encoding these files to QuickTime format (.mov) but the problem is that the resulting file size is actually bigger than the original MTS file which is unacceptable, especially considering I'm encoding the files from 1920x1080 down to 1280x720.
Does anyone have any experience using AME CS4 to convert MTS files to a more workable 720p format for uploading to YouTube?
I've tried a number of different custom settings to no avail (where you see an "or" is where I've tried different options):
Format: QuickTime
Video Codec: MPEG4-Video or H.264
Quality: 100
Width: 1280
Height: 720
Frame Rate: 29.97 or 23.976
Field Type: Lower First or Upper First or Progressive
Aspect: Square Pixels (1.0)
I won't list the audio options because I don't think that has any bearing on my problem.
Any ideas as to why the encoded file sizes are actually larger than the MTS file sizes? Maybe AME CS4 is not what I should be using for this task?
Thanks for your help,
Tom

I figured it out.
If you select H.264 as the format you can then select YouTube Widescreen HD for the preset.
This will set everything up to convert your MTS file to 720p and reduce the file size by around 30% with little quality degradation in my experience so far.
The only problem I encountered was the video was kind of choppy when the camera panned but that was remedied by upping the frame rate from 24 to 29.97.
Hope this helps someone and if anyone has any suggestions to improve efficiency or reduce file size post it in here.

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Using Adobe Media Encoder CS4 for MTS files

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