QT interlaced lines on KB effects

Hi. I made a video a few weeks ago in FCP 2 and used some photos. I did some Ken Burns motion effects on the pics, and exported it to QT H.264 at the higest Res. When I play the movie the I can see the interlace lines in it where I did the KB effects. The regular video looks fine but the pics are grainy and liney. I tried to go into QT viewer preferences and check the deinterlace button, but it didn't improve the quality. Any suggestions? Should I re-encode it with a better codec, or is there something in FCP2 that prevents this?

Any way to get rid of the interlaced lines on the photos in my project? Gurus?