The playback on your HDTV will be poorer than the original HD video. The resolution of the DVD will be 720x480 (standard NTSC... assuming you are in NTSC land) compared to the 1920x1080 of your original HD movie.
It is strange that the DVD played on your computer is smaller than the AVI... what AVI format did you export to... or how did you export the AVI? If you exported to DV-AVI then this should be the same frame size as your DVD export. If you use a 1080i project preset you can select the format to burn the DVD, I assume you burnt an NTSC DVD (assuming you are in the US).
Other thing, how long is your video, for maximum quality when burnt to DVD the video should be around an hour... any longer and PE7 will reduce the bitrate of the burnt video to fit the video to the DVD.
Thanks, you answered my question. Somehow I was thinking I would get better resolution but I guess that's what Blu-ray is for. I did export through the Export Movie menu and I'm pretty sure I selected DV-AVI. Anyway, I'll try again and export in mpeg.and see what happens. The video is only 8 minutes long. Thanks again.