Species is one of Sony's earlier Blu-rays and it's known that the transfer isn't the best in the world.

because HD is a scam

Your blind!

Doesn't the encoding scheme matter? As I understand it even at high bit rates MPEG-2 is visibly inferior (artifacts) to AVC and VC-1, and many early Blu-Ray releases used MPEG-2 because their authoring tools weren't up to snuff.

If given enough room to breathe, MPEG2 is perfectly capable of great picture quality. Kingdom of Heaven and Black Hawk Down are a couple of "reference" discs using MPEG2. The problem with early Blu-rays is that they weren't given enough room to breathe, and the people authoring the discs didn't pay enough attention to the quality of the work they were doing.

The compression codec used is much less important than the competence of the operator doing the encoding. It's just a spec, and it's not worth getting obsessed about. What matters are results, not specs.