Yeah, the jagged edges are probably normal IF you are enlarging that tiny little preview to look at it. It would almost be like enlarging your avatar and looking at that.

I'm asuming you got V1.1 which was the latest beta. If you look at the Podium dialog box you'll see an arrow at the top right corner. Click on that and you'll see an option for setting the image size. You can set it to 640x480 which will help.

You should also see a menu entry called Settings. You can adjust the quality which those sliders. The bottom one helps with antialiasing which removes or at least reduces the jagged edges.