I'm working with 1080i/50 P2 HD media in a project of which the final output will be SD PAL widescreen only (DVD and web).  So I've import my P2 media and transcoded to 1:1 PAL for editing.  I've also created a number of 1080i comps in AE and rendered them out using DNxHD 185x. 

My question: What is the preferred workflow to follow when brining HD renders into an SD project from a quality point of view?  I don't know if I'm just imagining this, but I'm sure that the quality of my AE comps looks better when I import as HD (format tab switched to HD) and then transcode to 1:1 SD, as when I import as 1:1 SD from the start.  Is this possible? 

When should I be using 8bit or 10bit rendering?

Using MCA 3.0 XP and After Effects CS3.