Blu-ray H.264 vs MPEG2 for Blu-ray

As I have perused this forum, there are those who have advocated the use of MPEG-2 rather than H.264 for Blu-ray as they contend that the final image in better. I have just completed a Blu-ray production using H.264 and the image is pretty amazing. I just don't know if I am leaving any image quality on the table. I just went with H.264 for the sake of time as the "Share" function for Blu-ray defaults to H.264. My workflow was Canon XLH1a to Prores422 to H.264 to Encore for authoring.

Incidentally, I did run into some encoding to H.264 issues at the end of the production when a "Ken Burns" sequence produced using the Photomotion plug-in from GeeThree gave an error and shut down the encoding. Pretty frustrating in a 3 1/2 hour encoding of an 86 minute production. Nonetheless, when I rendered and encoded the Photomotion sequence by itself, I had no such error. Adding it as a separate asset in Encore was no problem, and everything burned fine.

So, the 2 questions are:
Is there REALLY a difference in Blu-ray image quality between H.264 and MPEG-2?
Has anyone else run into the Photomotion error when encoding.

Using FCP 7, iMac i7, Snow Leopard, OWC quad using firewire 800 as scratch disc with all the latest updates.