Blocky/Pixelated image with Hardware-accelerated video encoding

Server Version#: 1.41.5.9522
Player Version#: 5.91.0

I have a N100 Beelink server with W11 and Plex Pass.

The client is a recent Samsung TV with the native Plex app.

When I turn on both hardware acceleration and hardware-accelerated video encoding I get consistently blocky/Pixelated videos, especially when the scene changes. I am talking about 1080p h264 mkv files with subtitles (so no direct play).

If I turn off hardware-accelerated video encoding (but leave hardware acceleration on) I get perfect image with no artifacts. Same if turn on both HW options and also add HEVC video encoding - unfortunately this is not a choice at the moment since it’s too demanding for my N100.

What can I do to fully leverage HW encoding/ decoding and preserve image quality?

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