I can’t point to any specific dvd, but more often than not when you watch a deleted scene on dvd, the video quality is horrible. It’s often blurry, washed out or over-saturated, and looks like crap more often than not.
I can understand if the sound might be awful, but why does it look like a videotape that’s been sitting around since the late 80s?
Because it hasn’t been through the processing (colour correction etc) that the finished film will have been. It’s probably too expensive to send the outtakes for processing.
This isn’t always the case - I’ve seen some deleted scenes that were the same quality as the film itslef, and I’ve seen others that looked like they were shot on my cell phone and had the SMPTE code at the bottom.
Expanding on what **Szlater ** said, they probably used the “rush” footage.
What’s a rush?
In times past, they’d shoot a scene, then someone would quite literally rush over to the lab with the film to have the camera negative processed and a quick-and-dirty print made while the camera neg was still wet and rush the print back to the studio so the director, producer and other bigwigs could view it and see if they need to re-shoot the scene for whatever reason before the actors took off or the set was struck. The rush film has not gone through the full range of processing. In particular, the film hasn’t been “timed,” which is a time and labor intensive process where they adjust brightness/contrast, color level, color quality - tint, skin tone, etc. Printing off a wet neg also tends to give a rather soft image, but the name of the game was speed. Quality came later, once the lab had the negatives dried and then took the time to make a good print.
Now, the rush is usually done with a small video camera built into the film camera. As they shoot the film, they’re also recording to tape, so rushes are truly “instant replay.” The video subsystem may be plain old video, or increasingly common, it may be high def.
Either way, the image quality will be very different than the final release. Occasionally, the DVD will make note of this - I think one of the more recent Harry Potter discs mentioned the image quality issue and how the footage had not been fully processed, but usually, they don’t mention it at all.
eta: can’t spell ‘film’ to save my life.
Is it possible the studio makes the extra scenes so grainy because it doesn’t want people cutting the extra material into the feature and then reselling it as a new release with extra footage?
It may be a factor, but more likely, they don’t want to spend the money to make the footage look good. If you have it, just slap it on a CD as it; people will buy the extra feature without you putting in much extra work.
Often times, they’re doing direct outputs from the Avid.
Avid is the editing system (computer based). To have enough space for all the footage, it’s compressed (low resolution) so they can load many hours of footage on the drives without running out of space.
For deleted scenes, they may not bother going back to full resolution tapes. And if they do, they usually don’t waste the time/money to color correct the footage.
So often you’re looking at low-res footage, heavily compressed and output without a final mix (also very expensive). It’s deleted footage after all. Just a curiosity for fans of the film. Most of the time I find it’s been removed from a film for a very good reason.
Every now and then a director will want to do a director’s cut with more footage, and so that footage will be in better shape. (For example, I’m a big fan of ALmost Famous, but the longer director’s cut is soooooooo much worse. Other than a few cool scenes, it makes the film too long and boring. Cut down is a vast improvement, sorry Mr. Crowe.)
But without the need for a director’s cut, the expense to pretty up the pic and audio is just too much and not worth it.
PS - when you watch the crappy footage? That’s the same footage we use to edit films and TV shows. We don’t see the good looking stuff until the end of the process.
It’s been a while since I’ve edited video, and back then, we did no post-processing. If the video was technically competent enough to survive editing on U-matic, (that ought to help carbon-date me!) we’d do it. At best, we might scrub crummy stuff through a genlock so some wacky sync didn’t make the whole studio go bonkers.
So now you do the editing on low-res footage, then the high-res, color-timed footage is washed through your EDL? Sounds positively spiffy compared to my college years. 
LOL. U-matic. 1 inch. Stone age. =) (And yes I am aware U-matic was 3/4"… just same time period.)
EDL depends. For most TV work, the EDL is a thing of the past (not nearly robust enough for what you need with a 5 or 6 layered video track, complex transitions, etc). Instead you take the Avid project and send it over to a Symphony or Nitrous, both high end finishing Avid stations. The “sequence” (the file that replaced the EDL) is completely readable by both, the footage is reloaded into the system at full rez (just the footage you need, not the addl hours of unused footage), it’s color corrected and finished on the same box, and output to tape – digibeta, an HD format, whatever. Then the audio is married up to it at the mix house. (They’ll output the audio onto the same tape, overriding the temp audio tracks.)
For features shot on film (the vast majority still), then a cut list is created from the Avid, and the negative cutter does his thing from that list. Not my field of expertise as much, but my wife knows that end of the process well. But essentially, it’s not that different from what it used to be.