Is there a way to apply different levels of filtering to a MPG source file split into multiple sections and avoid introduction of transcodes errors in the rendered file by applying the filters directly to the timeline and NOT cause distortion during rendering?

Problem:
I drag a MPG source file to the timeline then use the split function to break timeline into areas that require filtering at different levels. I drag the filter to the specific area on the timeline, the filter is applied, I play the section in the preview window and it plays fine, showing the filtering as I want it. I continue to the next section on the timeline. Once done with all the sections trying to render to an uncompressed AVI file to avoid introduction of transcode errors, this still causes them resulting in horrible output making all my work useless.

It seems the only way around this is to drag the MPG source file to the timeline, break into sections, apply the filters by draging to the preview window, instead of the timeline, then saving a series of AVI files. Once I work my way through the whole source file I have a series of "corrected" AVI files. I then clear the timline, load each AVI file in turn on the timeline, then render again as a combined MPG file. It works and there are no transcode errors, the filtering working fine, but it seems there should be a way to avoid all this extra processing.