Well, as has been repeatedly said, yes, it's noticeable. By the way, did I mention it's noticeable? Oh, you know, I find the drop in quality noticeable. Hey, the drop in quality is noticeable! OHMYGODthereisanoticeabledropinqualitybetweentheDVDandLD! It's been pointed out over and over and over again, there's no reason to rehash it. It's not a stunning revalation you're making. Most of the people working on these projects do not have access to a post house, guys, so we do what we can with what we have. Most of us ALSO do not have a crap load of downtime waiting for renders to finish, and so, work on it when we can. And since the whole purpose of this site is the OT, and the whole purpose of this part of the forum is OT preservation and restoration, why on earth would you be surprised and derisive that this attempt to put together the OT is being attempted? While I respect your efforts, Laserman, please try to do the same.
Yes, there is a sacrifice to be made, having to accept drops in quality in a few spots. However, this is a definite choice to be made between working exclusively with lower resolution LD transfer (and, despite your expertise, you will NEVER cull more detail out of it than the DVD transfer...it's just not there), making more Franken-shots up in Combustion, Avid, Jaleo, or whatever you choose to use, to add to LFLs butchering of some sequences, and accepting drops in quality for a few seconds of footage over the course of a 2 hour film, but retaining the higher quality DVD transfer overall. That's really what we're talking about here; a couple of seconds overall, which, when colour balanced to the rest of the DVD, are just honestly not as offensive to me personally as newly manufactured footage which tries to improve the existing product (wait, isn't this where it all started going wrong in '97?). You're more than welcome to try whatever works for you, especially if the momentary quality drop is more of a problem for you than the integrity of the editing, photography, and pacing of the film as a whole, (and probably, it's the particular attitude which should be expected from someone who's a post professional - me, I prefer the '97 Jabba sequece to the DVD version, because while the thing LOOKS better on disc, the animation is not as good...go figure, I'm an animator...we've all got our own ideas of what's important) but so far, I'm fairly happy with the results. Again, let me stress that my project at least, is NOT a complete DE-SEing of the film, and will retain some SE shots; some becuase it's just too much work for not enough gain to fix them, some because I like the new shots.
As for the audio, for the sections I'm working on, it honestly has not been a huge problem so far. I've had to do a few splices, but generally, the 2.0 mix works once you put the problem areas back together the way they originally ran. And while some people are dead set on having a 5.1 mix, it was only created this year for the DVD, so I've got no problem loosing it.