It is hard to explain, it is not like it is to grainy, you need to look at the samples on a big screen HDTV, it's like it all breaks apart, and the smoke looks like shit, like I said it is hard to explain, it just looks like pure shit, to me anyways.
The very strange thing though, I do not see any of this on the lossless avi file, it is only after encoding and making a sample Blu file and I watch on my HDTV, on the PC it looks fine, totally stumped.
But as you said, blinking Stormtroopers I can easily deal with, because at least they still look good, the sky, smoke, outlines of buildings, SHIT.