Clips are blurred on playback but sharp when timeline is paused

My students drag in clips they've ripped (eg archive material of news broadcasts) and PP plays them fine. But they're blurred, until you pause the playback (when they appear totally sharp). There's a yellow line above the timeline. 'Render in-to-out' doesn't change anything. How can we see them playing without looking blurry? Obviously the clip format (variable) doesn't match the timeline format (1080, 50fps). But will PP render them nicely?

Help!

System:

Premiere Pro 2025.3.0 (Build 84)

PC - Intel i7-13700 (2.10 HHz), 32 GB RAM,