Save the menus from Photoshop at the final DVD size (I assume PAL). Make sure the PAR is also correct. You are allowing Encore to resize and render all your menu elements, and it is not so good.
You can handle some of that in the default transcode settings for the project (what Encore uses for its render). But I do not think that will fix it.
And sometimes, the fonts or similar do not look good once you get them to DVD size. So redesign of some menu elements may be needed.