Xvid video looks blocky in stand-alone player

[Flux]

I made Xvid video from one of my DVDs and it looks fine on my computer, but it looks blocky in stand-alone player.

The video was made with MEGUI and I used 2pass HQ (hometheatre) profile. I also ripped subtitles and displayed them with TextSub Avisynth from .srt file. They look very blocky. There seems to be some bug with Textsub because, if I use 23.976 fps, subtitles "pulse" every second or so. This doesn't happen when using 25 fps (PAL TV and player) but I have to speed up the video by 4% and audio too. Divx players suppose to support 23.976 fps directly?

I made DVD from same Xvid-rip and it looked a lot better than Xvid itself , so it is not the Xvid video itself. There is something what my Divx stand-alone doesn't like. I have Philips DVP 3142. The Xvid video was 720x576 resolution. I preserved anamorphic and set AR as 1.778 in MEGUI before encoding. Player stretches it automatically to 16:9. Bitrate of the video is around 1.7 mbps.

[Lyris]

What are the settings on the TV? It's likely that you have Sharpness set too high which will emphasise compression artefacts.

[Flux]

But the blocky look (pixelated) doesn't appear in DVD versions even if I first do DVD -> Xvid -> DVD. TV would show more compression artifacts in that case. This suggests that the Xvid encode itself is fine, but Divx player doesn't like to play it correctly from some bizzare reason.

[nixo]

Did you encode using a cqm? If so, try without it.

[Flux]

I used H.263 and MPEG. Both produce about same pixelated image. It is like video has been resized with nearest neighbor.