
When I capture the same scene from VLC or WMP11 it shows up like this..

Also when I play mp4s and movies in Windows Media Player Classic and VLC(blacks are fine in VLC), the footage gets blocky if I make it full screen, at least that's when I notice it.
Here's an example
In Windows Media Player 11 full screen it looks fine

Now here in WMPC Full Screen it's blocky.

See the blocks on the top of the guys head in the middle around the corners?
Now I was trying to fix the blocks in Avisynth then realized that it's not suppose to be there.
Any idea how to fix this?
Also if increase the size whatsoever in Virtualdub, the edges around characters get messed up.. I guess that's normal but not good for editing. This isn't as important to find out about so don't worry about this unless you have a good idea about it.
So mainly I want to see what's up with WMPC and VLC and if I can fix it. If you could help me out with that mainly that would be great.