Hyperthreading could do it...SP2'd XP goes over 50% for me. My guess is the program is running at full speed, but only on one CPU. So, the other virtual cpu is sitting unused. Windows' percent meter is 50% for cpu1/50% for cpu2. If it is hyperthreading...it's not a bug, it's a feature
No this is not true. Your encoding will happen at full CPU speed (whatever Ghz it's running at).
The CPU really is going at it; it just doesnt look quite as impressive because taskmanager thinks it's only using 50% of the available processor power (which would be the case if you actually had 2 seperate CPUs, but you only have one). If your encoder were multi-threaded it would than show 100% utilization in taskmanager but in reality you would only seen a marginal increase in encoding speed (certainly not double) as the 2 threads competed for processor resources.
Not to be rude or anything but technically the only problem is that you arent interpreting taskmanager's output correctly in light of your hyperthreaded CPU.