Final Cut Pro Blockiness

I shot my movie with the Varicam and the HVX200.

I digitized using a Panasonic 1200 Deck via Kona HD SDI in.

I used AJA KONA DVCPRO HD 59.94 720 24p varicam preset.

I edited the project. Everything looks good (on a small screen at home), but as the timeline reached 20 minutes and I have about 9 layers of audio, playback is not great (the image becomes strobe like at times).

Before spitting back out to tape, I exported a quicktime movie (same settings as edit), then brought it back into FCP. Because the movie is now one 20 minute clip, it plays back fine (no more strobe problem).

I outputted back to the HD deck, then brought it to work and digitized it into the AVID DS NITRIS UNCOMPRESSED.

I am doing this in order to do some quick color correcting before making DVD's to enter into film festivals. Eventually, I will buy the duck program and rebuild the project on the Nitris, but for now, this will have to do.

Here's my problem: The video on the Nitris looks OK, but very compressed (lots of blocks in the gradient dark area). I can't tell if I caused this in the FCP process and can now only see it at work on a big monitor or if converting to one 20 minute clip killed the quality.

Where did I go wrong?
 
I figured out that it has nothing to do with exporting the file. Even my original timeline when color corrected shows high compression in gradients and blocking on occasion. It must me a limitation of DVCPRO HD or Final Cut Pro. Should I try different render settings?
 
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