Spooky i think v2 little bit more blury then v1... and its bad for me
But v2 don't have that noticeable Drawing effect... its good for me
V2 usex .264 codec wich dont causes crashes or selfminimasing of game window and work more stable then XVID... its also good.
So in some cases its most cases its better then v1 but one pictures provided by Tomperd above is noticeable lose of small details...

im not sure that i want to replace v1 by v2...
But i got idea of making HD prerendered cut scenes for year already, but my laptop so slow and dont have much free space for such job!
Step by step:
0) Find some powerful PC (good idea to have one extra fast HIGH END PC for game and another middle end pc with video capture card for capturing and encoding video from 1st PC)
1) Download NGC\GCN RE4 iso
1.1) Edit hud and font tpl files and make them transparent to remove buttons from quick time even during cut scenes (this will make these scenes difficult to complete, but for that reason we need to find out memory values for QTE buttons and force them to be the same so we can push any button to have success in QTE cut scene to record it, and we cannot push any button to record unsuccessful ending of QTE and capture it )
2) Download latest Dolphin and plugins, set them to maximum quality and HD resolution like 1280x720, turn off frameskip and sound, turn on Antialising + Anisotropy and all sort of effects (its good idea to use some shader for video plugin in dolphin that will improve quallity)
3) Then Run the game on PC1 which video out connect to video capture device on PC2 (its really good idea to have some person to help u start capturing video when cut scene will appear) shouleven with low FPS.
Low FPS will make hard to complete the game but it doesnt actualy its doesnt matter for videocapturing... video should be edited frame by frame... but if u will find PC1 that will run the game with atleast 25 fps (but best is original FPS as played on GCN so it will be easy to mix video with audio later) it will save a lot of hours of work.
To complete the whole game and capture all videos u will need about 20 hours .
4) after capture will be done it will be the time to cut some video to same pieces as we have in pc version, then mix the video fragments with audio that we already got (also that will need some fine tune to match exactly same sequences at it was originally in PS2\PS versions)
This will take also about 10-20 hours (maybe less but this time its not so easy to be sure) on this stage videos should be stored with minimal compression
5) After video fragments will be prepared it will be time for final mastering - tweaking some gamma settings to match the PC version default gamma, give the rite names to videos and finaly encode them all now with compression (but without loosing of details) to PC version compatible format.
Hope somebody can follow up these instructions sometime