Render to a lossless format like Quicktime Animation (100% quality) from After Effects. Then compress using another compression tool: Adobe Media Encoder, Apple Compressor, Quicktime Pro, Episode Pro etc.
What is the the Watchout system driving - how many displays? In what format/arrangement? Typically, it's best to provide Watchout video in segments suitable for each output device, rather than one huge file on all devices. The delay you experienced between files was probably the result of inadequate drive I/O speed.
If, for example, the display is created using two parallel projectors at 1920x1080, you're far better off building your comp at the full resolution, then rendering two segments at the native resolution of the two projectors, taking overlaps etc into account.
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p.s. I have seen someone actually created a 3840x1080 quicktime video and then using a mac system to convert it into .mpeg video with 3840x1080. But I have no idea how it was done.
That was probably done using a custom MPEG CoDec, nothing whichg you can do in any of the Adobe tools. As for the rest, do as Andrew said. use an external converter and create e.g. a DivX file using their 4K preset. Whether or not this will actually play inside this particular software, I have no idea. In my world, this kind of stuff is usually done via synced harddisk recorders and a video splitter...
Thanks for the reply. Guess I have to find another compressor to do so, any recommendations?
If you stick with my suggestion, you would require DivX Pro, which comes with a dedicated encoding app. Other than that you could try ProCoder. You may even get quite a bit with ffmpeg/MPEGStreamclip and one of its many derivatives. Just the same, you could use VirtualDub.