Meanwhile.... back on topic...
Wheelspinner, thanks for uploading your clip to Vimeo where your original upload can be downloaded. I retrieved your original from Vimeo, and it is a 1280x720 frame size video. BUT, if you look more closely, your image does not fill the whole frame like it should. Both the image and the frame are 16:9 aspect ratio, but the image is smaller than the frame. I think that is one reason for the lower image quality you see. Keep in mind that your upload to any of the free hosting site is not displayed in the same form as received. The site re-encodes your file into Adobe Flash Player format, and also lowers the bit rate at the same time to save some file space and make playback easier. The net result is your video gets downgraded... there is nothing you can do about that... they all do it.
But that aside, how did your upload get into the strange reduced image condition? Here's what (I think) you did. Open WLMM and toggle to the Project menu. You should see something like the first pic below. Note that the aspect ratio is set for "Standard (4:3)", which is the wrong frame shape for your HD video. It needs to be set to "Widescreen (16:9). When you use the wrong frame aspect ratio, your video is forced to have black bars above and below the image to make it into 4:3 aspect ratio shape as shown in the picture.
Then when you select one of the 1280x720 frame size options for outputting your final video, WLMM fits the 4:3 aspect ratio frame into the 16:9 1280x720 frame size as best it can, which matches the vertical height before it reaches the full width. So now your video also has black bars on the sides as well as on top and bottom. The net effect is that your original 1280x720 video image is now shrunk down with black border all around to fill up the final 1280x720 frame, as shown in the second pic below! And when that is re-encoded by the web site, you lose more detail.
I don't know if I explained it very well, but here's the bottom line. Make sure you have the "Widescreen (16:9)" set for the movie aspect ratio in the Project Menu
as I first mentioned. Then your final movie will fill the full 1280x720 frame when it is saved. And since the #11 shoots at about a 7000 kbps minimum average bit rate, pick one of the movie options when you save it that has a similar bit rate. You can make a custom one like I did for the #11HD with 1280x720 frame size, 7000 kbps bit rate, and 30 fps frame rate. Then just use that each time with this camera and you'll get good results.