Are These Horizontal Lines Interlacing or Something Else?

Hello,  I am working on a project to capture and convert all of my old home videotapes (Video8 and Digital 😎 from 1990-2006 to H.264 .MP4 videos. 

I captured them using DV Capture on Premiere Pro on an older firewire Mac as large .MOV files. 

When I preview the original .MOV files, the video looks good, without any horizontal "interlacing". 

When I bring the video into the Premiere timeline to resync audio, and add audio compression, I end up with horizontal "interlacing" in the program window. It also shows up when I export as a "Match Source - High Bitrate" .MP4 encoded with H.264. 

Here are my sequence settngs. This particular video is a Video8 tape from 1991 with a captured resolution of 720x480.

Here is what it looks like zoomed in at 400% in the timeline (top) and the original .MOV zoomed in at the same frame (bottom). 

I have tried to deinterlace by going to Field Options - Always Deinterlace, but it doesn't make a difference.

"Flicker removal" under Field Options smooths the lines out and makes the video look better but I don't want to lose quality since I think that effect essentially just blurs the image.

Any suggestions? Thanks!