Bug in Ulead MPEG.Now Encoder ?

[vim1978]

When I create a video file with "Perform SmartRender" option turned on, flicker and very serious macroblock occur after the transition
from a clip (e.g. a color clip) that require encoding to another clip that does not require re-encoding (because the properties of the second clip is same as the output setting). The position of the problem is always at the beginning of the first GOP after the transition.

The problem is gone when I turned "Perform SmartRender" off (re-encode everything).

However, the video looks okay inside MSP7 video editor but the problem is very noticable in other programs such as "Power DVD 5", "MPEG-VCR", "Ulead DVD Workshop 2" (not while advancing frame by frame) and all
standalone DVD players .

I have just tested it again using SP3 and the problem is still there.

Does anyone experience similar problem?

Is it a setting problem or is it really a bug?