I've been encountering a strange issue with trying to cut clips as .avi files in Virtualdub. I've done this before easily without any issues, but for some reason the output is of very poor visual quality this time around (heavy, heavy blocking).
I'm converting to UT YUV 420 using the Fast Recompress setting. I've tried removing every single filter from my avisynth script and literally just running the FFVideoSource("FILEPATH") command on its own, yet I still see the blocking everywhere.
The source files are 1080p .mkv video files and look great when played, and I've never had problems importing them into Vdub and converting to .avi, yet even the preview of the input video in Virtualdub shows ugly artifacts. See below.

I'm pretty stumped... I've never had this problem before. Any help would be much appreciated!