I use (2) and have found the same. When watching live, it's down to broadband speed and whether anything else is using up your broadband.

I'm streaming the Argentina V Croatia game via IPlayer right now and if I try to do anything heavy on the laptop the picture quality will get a lot worse.

I sometimes post new BBC series, and recently noticed some quality differences depending on method. My favourite way of doing these is usually to find a torrent source and then play that with VLC as it's easiest to get the exact frame I want with VLC's buttons. But resolution quality often suffers, partic if broadcast was originally HD.

So taking captures off iplayer - 2 methods, each as fiddly as the other if trying to get exact frames as no buttons apart from play or pause. (1) play it live online and capture from that (2) download through iplayer and then play the download through iplayer and take captures.

Have noticed that (2) gives noticeably better quality captures - sharper, less fuzzy, better colours. Anyone else found this happening??

Also - if (2) gives the best quality results, anyone know a way of playing an iplayer download through VLC (or similar viewer with added buttons) to get more precision for capturing exact frames??