Let's see if I can give some useful information, I've never tried that before...
First about the scaling, the loss of quality doesn't make a lot of sense, let me explain: you import a bitmap and it looks good. You put it somewhere along the z-axis and it looks small. You scale it to be as big as before and it should look just as sharp and detailed as before. As long as you do not enlarge it in comparison to the orginal you can scale to your hearts' desire. Understand? Good!
Second how to design your bitmaps. First decide what resolution your animation will be. 720X576 PAL? Ok, I can dig it! So what do you want to show? A nice pan across a street from left to right? Well, why the Hell not! How big should those houses be? About 2/3 of the height of the frame? Sounds a-ok! (is this getting annoying, I bet it is) Well, design your block of buildings and the only important thing in this case is the HEIGHT. Create a graphic about 400 pixels hight (approx. 2/3 of 576) and as wide as you want it to be but at least 720 pixels. In this example 2000 pixels. Then import in Moho. Height is fine, 2/3, width is too wide for the frame for panning across. Now put it somewhere along the z-axis and scale back to the original size. Quality is fine.
So, bottom is line is simple, the defining factor of size is the resolution of your final animation and the size of the visible part of your graphic. Does that make sense? Look at this thread and see what I mean:
http://www.lostmarble.com/forum/viewtopic.php?t=1167
Good luck,
Reindert.
www.nobudgetvideo.com
PS. Since I dislike Adobe I'll just pretend you mentioned .PNG images instead of PSP, I just turned dyslexic for a moment ok?