Working with 7d video

Having not too long ago purchased a 7d, I've just started processing the video in Premiere.

One of the things that I'm noticing, and that I'm kind of startled by, is that even minor grading--including curves, slight hue shifts--results in unacceptably blocky footage in terms of saturation and luminance. The obvious example would be a background sky that I'm pulling down slightly and which seems to posterize at even the most conservative adjustment.

Is this just what to expect when working with a highly compressed video ?

For clarification, I shoot using the cinestyle picture style (a flat curve) in 1920x1080 24p. All of my shots are exposed well and are at a low ISO. My screen is set to 32-bit, obviously.

If curve-flattening picture styles (like cinestyle) essentially flatten the midtones of the scene (because it's applying a reverse s-curve) does that leave the midtones with essentially less data ? Is that why a blue sky might exhibit posterization after even minor tweaking in post ?

Indeed! The AVCHD files are HIGHLY compressed and will not respond well to color grading, but it can be done!

In premiere pro6, my defaul tool is the 'fast color corrector' it is remarkebly quick and effective on DSLR footage.

While I do like working with curves, they can be difficult for 'fine adjustments' since it is a graphical representation whereas the FCC tool can allow you to click through each step increment.

As mentioned AVCHD files don't respond very well to PP, that's why RAW video is all the rage now.

But here's something that should help a bit:

http://rarevision.com/​5dtorgb/