Possible HDMI issue

I have just bought a DMR EX 85 which I am very pleased with. The issue is
with my Austar/Foxtel box and the Recorder/Plasma combo

Equipment:

AUSTAR box - Austar doesn't offer the IQ box or equivalent
PANASONIC DMR EX 85 - HDMI + Digital (SD) tuner, which is performing
extremely well, seeing we are smack in the middle of two reception areas and
get bugger all signal from both. The sensitivity of the tuner actually pegs
it better than our STRONG SD tuner!
PIONEER 50 inch PLASMA - with media box..... next to latest model

Connection is via HDMI between PANA and PIONEER

PROBLEM

When viewing Austar, there are horizontal lines when there is any motion,
which is a LOT of the time of course. Even when someone is talking, their
jaw movement displays this artefact. The cable interconnect can't be the
issue because it isn't happening when I watch DVD ..... so I am thinking it
may have to do with this "upscaling" feature.

I guess I can connect it 'traditionally' to check if it is the HDMI
processing ...... yup, I will give that a go to pin down where the issue
actually is.

Any further ideas/clues?

Thanks

Steve