Burn Highest Quality DVD from iMovie '11 where source is from DV tapes?

Hello everyone -- I'm hoping to find an answer that isn't too wildly technical and doesn't discuss the HD aspect of things.

I recently used the Share --> iDVD method and the results were pretty bad. It looked unsaturated, bland, pale, and blah. But any clips with increased contrast or saturation (changed within the editing process) looked jaggy and pixelly. In one clip, I lowered the exposure and brightness of rippling waves in water so they were very dark. It looked great within iMovie, looked like pixellated psychedelic nausea-inducing goofiness after I exported it, and truly appalling on the DVD.

The source video isn't brilliant, but when I make a Quicktime movie of it (using Share --> Export Using Quicktime, i think default settings) it looks OK. (except for those waves.)

I'm using an iMac running 10.8.1, Snow Leopard, and iMovie '11. iDVD is 7.1.2

I also have Roxio Toast 10 Titanium.

Also, I used whatever the default settings are to capture the source video from a now-old Canon DV camera. Was that a mistake -- are there special settings I should dig up?

Thanks so much for any help you can offer.

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Model Name: iMac

Model Identifier: iMac9,1

Processor Name: Intel Core 2 Duo

Processor Speed: 2.66 GHz

Number Of Processors: 1

Total Number Of Cores: 2

L2 Cache: 6 MB

Memory: 8 GB