Following GetGray's example, I copied an .ISO of the AVS AVCHD disk to my server and looked at its gray scale gradient. At first I thought it was perfect; I didn't see any banding. But then I looked very, very carefully (squinting and using peripheral vision) and was able to spot a portion of the scale (in the exact middle) where two shades of medium gray do not flawlessly grade from one to the other. From that spot on, either towards the white end or towards the black end, the gradation is flawless So I guess I do see one very faint example of banding. I need to burn the image file to a disk and see if my Blu-Ray player eliminates the banding.
I suspect that the banding you're getting is a bit more obvious, Kirnak. I hate banding and see it fairly frequently in low quality DVDs. I have seen it in a few BRDs, but it has always been in the encoding. Like GetGray, I have never been aware of banding that was introduced by the Dune.
Like GetGray, I'm also using a fairly high-end DLP projector (in my case a single chip LED model). I wonder if our projectors de-empahsize this sort of banding, or perhaps your flat panel TVs emphasize the issue. It may not make a difference, but I'm sending Deep Color (12-bit) RGB from my video processor because that is what my projector likes most.
Another possibility is that I need a cataract operation a bit more than my eye doctor is letting on.