Video imported is blurry !??!

I am using iMovie '11 version 9.0.4.  I am using a Sony Handycam DCR-SX63 digital movie camera and capturing video in the highest quality.  All video, when viewed on a 50" TV is crystal clear.  However, ALL video imported to iMovie'11 is very, very blurry and poor quality.  Any and all video imported is fuzzy and blurry.  Any projects created are fuzzy and blurry.  Any DVDs burnt are fuzzy and blurry.  I have tried importing to both my Macbook and my new iMac and there is no difference in the poor quality. I have also tried importing directly from the camera and also by importing from the SD card.  I don't expect movie theatre quality but I would like to have reasonably clear projects and DVDs.  Can someone please help??  Again, please note that video viewed by plugging the camera directly into the TV is flawless.  Any video transferred to iMovie is horrible.  (yes I have tried the stabilization mode and non stabilization mode).  Thanks for any help that can be offered.

Thanks, but for $300 I'd almost be better off finding a video camera that recorded in a compatible format.  I'm just an amateur trying to do home movies.  Aren't there any programs that will convert my MPEG2 Sony video to a type that will look good in iMovie and iDVD??

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