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I've been mostly watching 233Mb h264 encodes of Simoun, but in a couple of cases the Xvid versions have been significantly smaller than the h264s, so I've got them instead. Now, when I watched one of them, I remember at the start, being used it being in a larger file and done with a better codec, noting that it wasn't nearly such good quality. But a minute later I'd completely forgotten about this and I was just enjoying the show in the usual way. It made absolutely no difference to my viewing experience.
I think it's difficult to figure out how good an encode actually is, simply because the very process of wondering how good it is changes the way you look at it. The only way you can really tell that something is a meaningful imperfection is if you notice it even when you're not looking for it.
Personally, I've never found a 170Mb Xvid encode with meaningful imperfections, by which I mean anything which detracts from my enjoyment when actually watching the episode. I'd like to see more <150Mb h264 encodes, myself.
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