Lo-res Looking Video after built and format

Dear friends.
I have a project that was initially cut in FCP. I exported the footage as a QT clips ( I miss the MPG2 from FCP Export so much!!) and imported the clips (Average 1.5Gigs ea.) into DVDSP.
I created my menus, buttons and the whole enchilada. But I noticed that the size of the file was only 850MB. I imported a total of 6 QT clips and when finished the project is only 899MB.
I checked the preferences and I have a bit rate of 5.5 and a Max Bit rate of 7, and also 6 and 5.5 too in a two pass mode.
When I play the simulator, it looks good, but...
Looks terrible in my computer monitor using the DVD player and looks bad after I burnt the DVD and played it on a regular TV.
So I tried again, this time I encoded with Compressor.
Used the DVD 90 min setting thinking that it would help.
No change in the size of the file. About 898MB.
And when burnt to a DVD, the result is the same.

If the QT files are about 1.5Gig each, shouldn't the size of the built be larger and then I can play with the bit rate until I get a size that fits on a DVD?

What am I doing wrong?
Can you guys help?
I am using FCP Studio 2.
G5, 2.5GHZ, 1TB storage using OSX.10.4.

Thank you in advance!

I have read and re-read your post, but one thing seems to be missing.

What clip material did you start with? There seems nothing wrong with your workflow, but something else is amiss.

Default statement is "Garbage In = Garbage Out", which means you can't start with low rez material and end up with a pristine output.

Hi John,

Thank you for reading my post.
I started with DV material, digitized to FCP via DV deck.
The files were short cilps.
When I finished the editing on FCP I exported the clips as QT.
And the sizes were roughly 1.5G each.
But when I imported the QT clips into DVD Pro, the resolution sent down dramatically.

I solved the problem already, the QT clips from FCP had the FCP icon.
I opened them with QT player and re-saved them with a different name and re-imported them into DVD Pro.

They were pristine and sharp.
The DVD file was 2.5Gigs and I am happy, now my question still remains. Is this a bug?
Why didn't the FCP QT clips were looking so bad in DVD Pro?

Thank you!