[popcornmix]

I would like to know will there be any improvement to de-interlacing currently it is very poor compared to win 7 mce or the TV set. It doesn't matter is it live tv or tv recordings.

SD deinterlace should be very high quality (it's a motion adaptive deinterlace similar to yadif).
HD deinterlace is a much simpler "bob" deinterlace.

I think you need to post a sample, and explain what you don't like about it. Ideally demonstrate that it can be played better on another system (e.g. xbmc on windows/linux).