I think it depends on the source material and whether or not VideoStudio 8 has to re-encode. I used to have a Dazzle hardware Mpeg2 encoder and the quality was excellent. However, when I tried to burn the material to DVD, the quality went down because the software program re-encoded the material (I think it's because the Dazzle card produced non-compliant DVD mpeg2 files or something).
Later I got the Hauppauge WinTV PVR250 and my software doesn't re-encode the video so the quality stays really good.
You could probably adjust some quality settings in VideoStudio 8 that might help the final output quality look better....