Here’s a few tips from Cinetech on how to get better results from Youtube’s encoder.
1. Learn to shoot better quality videos for the Web.
2. Your source video needs to be ideally high resolution. For instance: MOV or AVI file, NTSC 720×480 or VGA 640×480.
3. You need to get a high quality video encoder. Keep in mind that most video editing programs such as Apple Final Cut Pro, iMovie, Adobe Premiere Pro, Windows Movie Maker or Sony Vegas, come with an encoding engine so you can export your videos directly from the timeline.
4. YouTube resizes your videos to 320×240 pixels, encodes them to Flash 7 at a data rate of approximately 250 kbps and compresses audio to mp3 (22.050 KHz, monophonic).
5. It’s very important that you keep an aspect ratio of 4:3, otherwise the quality of your video will be severely impaired.
6. YouTube recommended settings are:
* MPEG4 (Divx, Xvid) format
* 320×240 resolution
* MP3 audio
* 30 frames per second
Youtube should probably improve their side of the “equation” as well. They do have director accounts so maybe they could test the water by providing more encoding options for them and see what happens