The videos are not re-encoded, it's lossless.
Mona
This is 100% not true
The video and audio are still downloaded separately
The video is then re-encoded to add the audio back in
This is why things do, in fact, appear jittery in many cases (including Hulu, Amazon, etc), and why Amazon takes a good bit of time post processing (3-5 minutes, which is admittedly better than it originally was).
Lossless would mean that the video is downloaded straight from the website, nothing is done to it at all. This is not the case here. It is re-encoded