Then Movie Maker (and the process of using it) is degrading your original video. By the time you burn the DVD you are using a second or third generation. And....if you are altering the picture size, colors....etc using movie maker, then you lose even more quality.
So, the only way to eliminate these problems (using your current programs) is to:
1. Alter the original video as little as possible doing only simple changes.
2. Make sure your settings are for MPEG2 not MPEG1 and high quality, which means a high video bitrate.
3. Since the DVD burning software seems to "force" the DVD standards, then that program will also lower the quality, when your existing video is different.
The only other alternative is to purchase another program that will accept the AVI/DV files directly to burn to a DVD or........pre convert the AVI/DV files to a non-compressed or lossless format like AVI/Huffyuv and then use Movie Make and burn later. That's the way I do it.
There is a open source free program called MediaCoder that will do that. But you'd be introducing another learning process.