Yeah..you do need to do some "tweaking".
Almost all 56k defaults are pretty crappy.
They go, obviously, for the smallest size files and bitrates for people on dialup so they have time to download the files.

But the quality is CRAPPY! So, play around with it and see what bit rate works best for you. Frankly, I hardly ever go BELOW 768k for any video. And I've got a lot of 56k dialups, and most of them never complain, especially using programs like "Get Right" etc.

And like Jason said, lower those bit rates for audio..they set them as high as 224 sometimes which is ridiculous..you actually can get by with 32k for MOST videos for audio.