Since I am the CTO (Chief Technology Officer) for a cable/satellite channel (xy.tv), I am have researched alot of this stuff.
Mpeg2 is the standard for pretty much the whole world for broadcast video. Every source available (Terrestrial TV, Satellite, DVD) uses it, and it works quite well. Mpeg4 is a new emerging standard that even the Mpeg group talks about as "the standard for multimedia for the fixed and mobile web" http://www.chiariglione.org/mpeg/
and not a broadcast format.
The problems with changing over from Mpeg2 to Mpeg4 are many:
1) Complete changout of all equipment, from encoding to display
2) Non-proven at broadcast quality like mpeg2 is
3) Very high compression "horsepower" needed
All professional video editing is done typically in either Mpeg2 or DV or some other high quality format. Perhaps Mpeg4 as a delivery method for web based content might be good, but right now using it for HD or SD television is not practical at all.
When one realizes just how much video content they are getting using Mpeg2 compared to an uncompressed video stream, it is quite amazing. Lets compare 1 minute of video using Uncompressed, MiniDV and Mpeg2 at DVD, and Satellite quality:
720 (wide)x 480 (high) x 256 (levels) x 3(colors) x 30(frames/sec) x (60 sec)= 477757440000 bits/minute or 59719680000 bytes/minute or around 55 gigabytes/minute for uncompressed video.
It runs 25 megabits/sec * 60 (seconds) = 1500 megabits/minute or 187 megabytes/minute or .1831 gigabytes/minute
DVD Mpeg2 (6 megabits/second):
6 * 60 = 360 megabits/minute or 45 megabytes/minute or .0439 gigabytes/minute
Satellite Mpeg2 (2.5 megabits/second):
2.5 * 60 = 150 megabits/minute or 18.75 megabytes/minute or .0183 gigabyts/minute
So Mpeg 2 satellite delivered video is only .0332727% of the origional bitrate of uncompressed video.
My point: Mpeg2 does a pretty good job at compressing video.
As to recording video from a 501 to a computer, the best is to use as high a quality setting as you can stand to use. Every time you compress/uncompress/recompress video, you lose picture quality. That is one of the reasons that some of the regular channel on satellite and cable look bad because the bitrate used by the uplinker is too low to handle the recompression by the provider.