Ok, got it on the not re-encoding.   Would the quality of the resultant BD be noticeably different with multiplexed vs. not?  

Sanity checking here ...  I noticed that if I import a separate .m4v (and audio file) into Encore it does some thinking ("pending ...") and eventually comes back with "Don't transcode".    However, if I produce a .m2t file using exactly the same settings other than TS multiplexing Encore comes back with untranscoded/Automatic.

Is the above to be expected or not?   If yes, is Encore saying it needs to transcode simply to demux the audio, or is it going to transcode the video stream as reported?

Thanks

Hi Jeff - I am using the defaults for H.264 Blu-ray and the 720p 59.94 preset within PP which has Dolby Digital for the audio format, which in turn matches the default transcoding settings in Encore.   If I export with separate .m4v and .ac3 files Encore reports "don't transcode".  If I go back and export with the only change being TS multiplexing Encore reports that it will transcode (I assume that is what untranscoded and automatic mean).  

I wasn't sure exactly what you meant by match the project audio settings, so let me know if I missed something here.

Understood on separate being better.  I was trying to kill two birds with one stone by having a playable .m2t file that I could also burn to BD.    It's not a huge deal, worst case I will just have to deal with multiple exported variants when I complete a movie.  

I see the default audio format for H.264 Blu-ray presets is PCM.   What is odd is that if I turn on TS multiplexing not only is the format changed to Dolby Digital, but that is the only option.  PCM as an audio option dissappears from the user  interface.  Is that to be expected?  

Further, if I change the default transcode settings in Encore to be Dolby Digital, my .m2t file stills says it needs transcoding.  Earlier Jeff thought that if the audio project settings matched Encore would not need to transcode.

Jim - undertsood.  I'm just grappling with export file overload.  Every time I put together a home or bicycle video I have to create a .m2t file to playback on PS3 and computer, separate audio/video for making BD's, project archive using the project manager feature, and then a master file using a less lossy codec in case of a future backwards compatibility issue with reloading old projects.    I will do what it takes here, but am admittedly confused as to why Encore (apparently) needs to transcode the video stream here.