Interlacing problem with Sony Vegas Movie Studio 11.0

My HD videos, produced in Sony VMS 11.0, are really badly interlaced. I've tried setting the deinterlace to blend and interpolate, but it makes not a jot of difference.

I've tried various player software, and the only player which plays back without the horrible interlacing is Windows Media Player. The only problem with WMP is that the picture is horribly smudgy, like an oil-painting.

Can anyone suggest a solution?

You are probably shooting in an interlace format.
Set your camera to record in 30p and not in 30i or 60i.

Zoom player from Www.inmatrix.com does a decent job of deinterlacing video during payback.

In Vegas, when you are encoding, select the progressive option, or the deinterlacing option.
There should be an option to use upper or lower field for the deinterlacing.