Are there any 3rd party compressors better suited to this that people
can recommend?

I prefer Sorenson Squeeze (don't be misled by the name - it can also
encode to On2 VP6)

http://www.sorensonmedia.com/products/?pageID=1#ppc2

I'm guassing you are currently using the encoder that ships with
Flash? What settings have you tried?

Pete
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