MJPEG Transcoding Problems (Noise) And Possible Solutions?

[Phire]

Recently when I was at the HuffyYUV page i read about MJPEG having "noise" to it. At first I didnt understand what he exactly meant cause i've never actually really seen the noise. But recently i tried to encode a 512x300 video (from 704x480 video) and there was a scene with a gradiant of color.. And no matter what the datarate was when trying to encode the file to MPEG-1, It just kept giving this noisy type picture.. Yet the original MJPEG was very clear. Then I had realized this is what the person at the HuffyYUV page was talking about. Now my question is, Is there any solution for this besides changing codecs? Would a capture at a higher datarate of MJPEG eliminate this problem?