Video that has been professionally encoded in the MPEG-2 format may be virtually indistinguishable from the uncompressed video source. The extent to which the original image quality is maintained depends mostly on two factors: the bit-rate used and the nature of the material.
Remember that MPEG-2 works by storing redundant information more efficiently. A relatively static scene (two people talking in front of a wall) will have far greater frame-to-frame redundancy than a fast-paced action scene (a high-speed car chase). With fewer redundant bits to discard, the action scene will require a higher bit-rate. Looked at another way, a low bit-rate will cause more compression artifacts (blockiness, for example) in the action scene than in the static scene.
MPEG-2 video may be encoded in either Constant Bit-rate ("CBR") or Variable Bit-rate ("VBR") modes. In CBR, bits are allocated evenly across the entire program. But VBR addresses the fact that complex scenes are harder to encode. In VBR, the average bit-rate may be the same as in CBR, but more bits are allocated to difficult scenes, and fewer to the rest.
The peak bit-rate available for difficult scenes will never be higher than the maximum DVD-Video video transfer rate (9.8 mbps), less headroom (about 0.4 mbps), the data rate of the audio (192-448 kbps per Dolby Digital stream; up to eight streams supported), and subtitles (4 kbps per language; up to 32 languages). For example, a title with a 5.1 channel English soundtrack (at 0.384 mbps), plus stereo soundtracks in French and Spanish (0.192 mbps each) would have about 8.6 mbps left over for video.
If the title's video program were short relative to the disc capacity—under about an hour on a DVD-5, for instance—there would be no advantage to VBR, because the entire program would fit on the disc even when encoded entirely at the 8.6 mbps peak video bit-rate. But if the program were two hours long, the average data-rate would have to be reduced to about 4 mbps to fit on the disc. This rate is probably too low to yield good quality in complex scenes, which generally require upwards of 6 mbps. Instead of increasing capacity by moving up to a DVD-9, which is more expensive to manufacture, VBR encoding would normally be used to increase the quality of difficult scenes by re-allocating bits saved in easy ones (which may be encoded at rates as low as 2 mbps).
