Absolutely, it's perhaps even more of an issue than the DV codecs in use. Those boxes have a lot of work to do, at least the DV codec (such as the one in Vegas) only has to work in the digital domain. Fortunately I normally only have to ingest from analogue coming off VHS so it's not worthwhile investing in high end converters but for BetaSP one could justify spending several thousand on a converter.

Interestingly enough last night I was trying out one of our SD Connect boxes, 1394 out of my DSR-11 and from the box into the monitor vie S-Video. It's hard to be certain without doing a proper test but the image did look better than what I remember coming out of the S-Video port on the DSR-1, so perhaps even D to A converters come in different quality levels.
Bob.