Uh... x264 is just an implementation of H.264/AVC, which is MPEG-4.
The MPEG-4 you are thinking of must be Avanced Simple Profile or something.
And the DVD's really are drowning in a sea of artifacts, Like the opening battle in my EPIII DVD, if I scale it up to my display size t oview it fullscreen it's hard to tell what is spaceship, planet, or just artifact mud. Granted, this is a visually dense scene with lots of movement but it's still terrible.