Depending on the speed of your computer and the resolution of the photos iMovie may not be able to show the photos including Ken Burns effcts etc. in real time at full resolution. This happens especially if you 'skim' the video in iMovie soon after importing the clips and before iMovie has had time to do the necessary transcoding in the background. In such cases iMovie uses lower resolution so prevent dropping too many frames.
As woodie said, the real test is to share/export from iMovie to file then play the file in Quicktime Player. I think you will probably find the quality is OK. Why not copy a small part of your timeline to a new project and share it to check if its OK?
Geoff.