The fuzziness on the timeline is normal:
Playback is blurry
Shane's Stock Answer #2:
1. Disable overlays on the canvas
2. Make sure you've rendered everything (no green bars at the top of the timeline
3. Upgrade to 10.3.8 (many people had this crop up when they upgraded to 10.3.5)
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docs.info.apple.com]
DV footage requires large amounts of data and many computations. In order to maintain frame rate and be viewable at a normal size, only about one-fourth of the DV data is used in displaying the movie to the screen. However, the DV footage is still at full quality, and is best viewed thru a TV or NTSC monitor routed thru your camera or deck.
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