I tried to finish my first project in iMovie 08 today by getting it onto a DVD via iDVD .. and was HORRIFIED by the output "options" of iMovie (or rather the designated workflow the users are told to use by Apple!).
You're seriously supposed to transcode your iMovie project to some unnamed laborious codec (presumably MPEG4-AVC) in one of several random resolutions (the largest of which 960 x 540) into some system wide media store before you can access it in iDVD, which then will have to re-transcode it to MPEG2 of course and also back to a native PAL resolution!!
I admit, I didn't research what Apple means that iMovie is good for (= YouTube and mobiles) before I started editing a video with it, but I didn't expect this.
The thing is: DV-cameras and TVs are optimized for certain image formats (PAL: 576 lines, interlaced), anything else, i.e. conversions from other formats, will always look bad somehow. And especially converting an interlaced image to a different number of lines (which kills the interlacing and thus ruins fluid motions) in the middle of the process when you could make use of the untainted interlaced stuff in the end (DVD) anyway is just crackbrained.
Ergo: Don't think of using iMovie when the end result you want to have is a DVD; The only high quality output iMovie allows is to an AppleTV-box, which may be optimized for their idiotic 960 x 540 material - which isn't even HD either (Apple advertises iMovie with "..or watch it on your high definition TV!"), it's even less than the proper 16:9 PAL image (1024 x 576, if you expand it to square pixels)!!
Do I see this right?
P.S.: I'm now looking for a way to render directly to MPEG2 from iMovie via the Quicktime output feature. And if iDVD doesn't eat the predigested MPEG2 (which I somehow expect already) I can still use any serious DVD authoring tool to get that to a disc without further transcoding..