That's the nature of JPEG compression, even at the highest quality level.
The HD TV obviously magnifies the artifacts.
I know nothing about TV or video, I just avoid the JPEG format at all costs myself, unless someone or something absolutely demands a JPEG from me, in which case I only generate the abomination as the final output file. Try working with PNG files instead—if your intended application permits it.
I agree, and it's why I do not use JPEG, unless the client's needs absolutely dictate it.
I do a lot of Image work (tons of Titles) in PS, that goes to both DVD-Video and BD (Blu-ray Disc), and never, never introduce JPEG into the workflow. Everything that I output is PSD (or maybe a very few PNG's).
However, from the last response from iRuss, PSD will not be an option either.
As a bit of an after thought, perhaps iRuss could produce a Premiere Pro (or Elements) AV file for the SlideShow and Titles, and put an H.264 in an MP4 "wrapper" file on the thumbdrive? Then, a PSD could be used effectively in the video.
Just thinking here,