The choise is depending on what the format of the source file is, and where you want to export to. You never can get a better result as the source file, and there is no use to go to highly uncompressed when you want to make a small DIVX file on export .

Basically, if you capture from a DV camera, choose DV-AVI. This is the same codec as used on the tape and Liquid handles this native. This way Liquid does not need to convert the format and you will keep the best quality.