There is a chance that it can pick up on encoding weaknesses from the previous MPEG encoder.
Good theory.

That can explain why some people would see more blocks than others.

Yeah, in my case every one of my files was encoded using my Hauppauge HVR-1850. Not sure how that matters but the fades are beautiful.

Ah, we're getting somewhere! This would make sense. Hauppauge tends to be softer quality on its MPEG encodes, reducing mosquito noises and hard-edge block noise potential. Higher bitrates would also reduce the presence of blocks (or near-blocks) for Womble to make worse.

Again, this makes perfect sense. :)