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Hello hellohello (I couldn't resist),
When it comes to getting the best quality transfer of a VHS tape to a digital file, the first thing to consider is the quality of the VHS player that you'll be transferring from. It may be worth spending a little money on a really nice VHS player that has a 4-head system and a high quality hookup (such as S-Video) to your computer – or through an old DV camera with a FireWire hookup.
The next thing to consider is the kind of file that you'll be making when you capture your video. You'll want to make sure the codec you're capturing the video to is either lossless or a lossy codec with very little compression. The QuickTime ProRes NTSC DV codec or the an Uncompressed 10-bit codec are the way to go if you want to lose the least amount of quality or detail in your footage. I would have suggested the Animation codec which is a very high quality lossless codec, but that is generally not seen as a good codec to edit video with. If you're not looking at editing your video, this may be a good codec to use (though it will eat up disk space fast). If you don't have the QuickTime ProRes codec, you can download it here: http://support.apple.com/kb/dl1396.
Once you've chosen the right codec for capturing, I would also suggest setting up your timeline with the same exact settings as your captured video file. So if you captured your video as a QuickTime Uncompressed 10-bit at 720×580 pixels and 29.97 frames per second, interlaced, you would want to set up your sequence in Premiere Pro to have these same settings. To make things even easier in Premiere Pro, you can just drag your captured video file to the New Sequence button at the bottom of the Project window and Premiere will set up your sequence with the right settings for you based off of the video that you selected. That's what I would suggest doing.
When you're done editing your VHS captured video and want to export, the best idea is to select the same exact settings that you used when capturing your video. Ideally this will be a losless or near lossless codec so that Premiere puts a minimal amount of compression on your already lower quality video capture.
Up to this point, I have been assuming that you'd like to keep the highest quality possible in order to archive these files for later use. However, if you don't have a ton of space on your computer and want the "perceptibally" highest quality video compression, I would take your suggestion from earlier and recommend exporting an H.264 file with the highest bitrate setting that your hard drive can afford. The bitrate setting is going to be the biggest factor in determining your file size so keep the bitrate number reasonable if you want to save space on your hard drive. If I want to save on space, I'll generally keep my bitrate at 14-20 Mbps for DV footage.
I hope that helps! Good luck.