How can I avoid re-encoding of video in iMovie and use it for cutting only? I have a video that was created on a surveillance camera with the (for video) unsusual resolution of 1280x1024. It's encoded with H.264 and encapsulated in an MP4 AVC container. The quality is rather good, especially considering the difficult structures in the image (the fine steel structure of a radio telescope dish and dark branches against the sky).

I tried to cut it using iMovie, but all export methods I tried so far yield very bad quality videos. The comparison below shows the original footage (left) and the best result I achieved until now (right). This was created by using the built-in exporter and specifying a "large" video. Note the greatly decreased resolution and blurred structures.

 

There are many hints on the net that suggest using QuickTime export, but I was not yet able to get any better quality out of it. I tested:


DV output format -- blurry, and the aspect format changed even though I specified an output video size of 1280x1024
H.264 output -- extremely blurry, even on highest quality setting and with two-pass encoding


So my question is: How can I tell iMovie to simply cut the input video without re-encoding it, or alternatively: How do I tell iMovies built-in  exporter to use a different video format than "large" (720x576)?

File size is not an issue here.
Indeed, you should use QuickTime rather than iMovie: iMovie will import (and therefore usually encode) the movie, but will also force you to export, as you have noted.

The main interest of using QuickTime is to use its editing features.

Assuming you're using QuickTime X (Snow Leopard / Lion), open your movie file, and hit ⌘T (or Edit > Trim). The timeline will morph into a yellow double-ended scrollbar so that you can trim the sequence.



Adjust it to fit the sequence  you want, and validate the trimming with a click on the Trim yellow button. You can then simply save the file (⌘S), without the need for an export that will necessarily reduce quality.



Update seeing that you need to remove parts of the video.

You'll need the more advanced editing features of QuickTime 7. To install it on Snow Leopard or Lion, refer to Installing QuickTime Player 7 on Mac OS X v10.6 or Later on Apple's KB.

You'll then be able to open your video with QT7, select parts of your video with I (set input point) and O (set output point), and delete the part with a stroke of ⌫. Then, simply save the file, as said earlier.

You might need a license key for QT7, though (I don't remember if the latest versions of the OS need them or activate the Pro features for free).