Why can't I make a project progressive?

When I open a new project in Encore, I want to set it to progressive. But no matter what I try, the Video Transcoding settings are greyed out and I can't change it from Lower Fields First. This has left me with jumpy videos, and I have no idea how to correct it. I've tried googling for solutions but this doesn't seem to be a widespread issue, so I'm guessing I've missed something. Can anybody help? Any advice would be appreciated.

Export from Premiere with the desired settings for mpeg2-dvd.
Import the two files into Encore.
Encore will  be set to Don't Transcode for the files.
Make menu and burn.
That should do the trick.

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