DVD to MKV fast action horizontal lines using Xmedia Recode

I am trying to convert a DVD with 2 audio streams to an MKV. I have found that Xmedia Recode to be the best program for my use although I'm having difficulty in achieving the results I want. When I convert the video any fast action on the converted MKV has horizontal lines across it. I have tried various video options such Rate Control Mode and Bitrate but I'm not having much look. The converted MKV looks really good when there is little camera movement however the video I want to convert is very fast paced.

I'm not too bothered about file size. The original DVD is about 45 mins and 2.2Gb. I'm happy for the MKV to be between 1 and 2 Gb.

Can anybody recommend some setting to achieve a smooth video, preferably in Xmedia Recode?

Thanks