Ignore the "dire warnings". The software was (sadly) invented for morons, a dummy-friendly version of the highly regarded TMPGEnc MPEG Encoder v2.5 that was discontinued. You need to leave "always interlaced" from interlaced sources. Never give software control of anything. You make the decisions, not it.
Bitrate is only important as it relates to allocation. For a 352x576 resolution, a setting of 4000k is plenty. It sounds like you have 720x576, which needs a much higher resolution, in the 6000-8000k range. See the bitrate graphs on this page, about halfway down:
http://www.digitalfaq.com/capture/avivsmpeg.htm
You can leave the setting at "0" but it will never go that low. If you examine the final file in an MPEG bitrate viewer, it'll show you maybe dipped 1000k lower than average. It will never hit zero, probably never even under 1000-2000k, not at the 4000+ range.
Setting a max bitrate is "safe" but serves no purpose. TMPG does not handle 9000+ bitrate very well, and may go over the spec maximum allowed. Just use a bitrate that properly compresses the video for the situation at hand. Setting it to 9800k is lazy and wastes disc space. I would only suggest 9000+ on some like wrestling or boxing matches, where you have detailed crowds as a background, and fast moving foregrounds.
(I apologize for any typos. A bit tired today, will fix them if I see any later on.)