Phil, I have to say that a year ago I would have agreed with you, I was very disappointed with the results I ot from my first couple of shoots hey were flat, lacked any kind of detail the focus seemed wooly in all but the very strongest sunlight and I was left wondering why my little Sony HD cam was producing much better results - right out of the box.
Only after reading many posts in this and other forums did I realise that Canon have done themselves no favours in retailing a product that needs a good deal of tweaking before it performs well. Given degree of excellence Canon have gained in stills photography, I was stunned by their lack-lusta approach to video. I always expect to have to do some 'personalising' to setting in just about everything I buy, but do expect good results out of the box and that - as you have found out - is not always the situation with the XH.
I can say that I am now happy with it, although having said that I have been using a Panasonic HMC151 more and more recently simply because it is easier to record to SD car, a lighter camcorder and easier to set-up and use for the type of work I put it to - horses for courses I guess
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