That was a big help
Thank You!

Sonic, please elaborate:
when I render to AVI, I have the option of rendering in "PAL DV" or "Uncompressed".
The result is a big AVI or a huge AVI.
Either way, I can feed the AVI through Vegas Capture and, using 1394, input to my DV Camera.
Then, as you say, I would capture again with zero loss.

This means that "PAL DV" (being compressed) does not loose quality with respect to "Uncompressed" ?

Of course, Uncompressed video is almost unmanageable. But I thought that there was some trade-in in quality when choosing PAL DV.

Please clarify.

Here's the situation as I understand it:

When you use a miniDV camcorder, a chip in the camera takes the "raw" video and compresses it using techniques similar to jpeg. The resulting file is about one-fifth the size of what the raw video file would be, yet the image differences are nearly indistinguishable. If you then capture that "DV" video file to your PC, there is no further quality loss. If you edit the video and use just cuts, there is no quality loss. You can transfer the video back and forth between PCs with absolutely no quality loss, because the bits are simply being copied one-for-one.

If you insert a dissolve between scenes, VV needs to decode that portion of the DV video into raw pixels, do the mixing, then encode back to DV. The codec used in VV is good enough that it could do a round-trip decode/encode dozens of times on that one section before you could see any quality loss.

So the short answer is that you won't see any difference between working with raw video and working with DV, with a few exceptions (blue screen work, for example).