Lossless Export means keep original parameters like codec, video size, bitrate, etc of the video files, so lossless merging is just to merge all videos clips into one and don’t make any change of video inner settings. To it corresponding is Re-encoding, which will make you loss some quality in the process of video decoding and encoding.
Actually, the output quality is mainly determined by three parameters: Video Codec, Video Size, Video Bitrate.
Video Codec is the core among the three. And H.264 codec is currently generally recognized and widely used, most of Blu-ray disc, camcorder are using this codec for video encoding. And the current CUDA, intel acceleration technology only works on this codec. So for merging MTS, M2TS files from camcorder, take Aunsoft Final Mate for example, lossless export means merging video clips into one and keeping its original video codec H.264.
Video Size, also called video resolution, which is the number of distinct pixels in each dimension that can be displayed. The frequently used HD video resolution specs are 1920×1280 and 1280×720. And 1920×1280 is more used in Blu-ray discs and Camcorder videos. So for merging such MTS, M2TS files from camcorder, lossless export means merging video clips into one and keeping its original video size 1920×1280 or 1280×720.
Video Bitrate not only determines the quality of video, but also how long you’ll be able to record before running out of memory. For camcorders it’s measured in megabits (one million bits) per second, or Mbps. The more data you’re recording, the better the quality of your video. Many HD camcorders will tout themselves as “Full HD” and offer 1920 x 1080 resolution recording. However, not all Full HD camcorders record at the same maximum bit-rate. Consider two hypothetical camcorders: Camcorder A and Camcorder B. Camcorder A records 1920 x 1080 video at 15Mbps. Camcorder B records 1920 x 1080 video at 24Mbps. Both have the same video resolution, but Camcorder B has the higher bit rate. All things being equal, Camcorder B will produce the higher quality video. So for merging such MTS, M2TS files from camcorder, lossless export also means merging video clips into one and keeping its original bitrate, 17Mbps, 24Mbps, or 28Mbps.
So from above, what you tried great effort in searching on google is to find a tool to help you merge such videos and keep original video codec, video size, and video bitrate, etc. And now I would wonder If you make a conversion to a different container format like MOV, MKV, MP4 and also keep original parameters, or even set higher bitrate, you will find the re-encoding will give you higher video quality. For example, use the same MTS video files: H.264 encoded, 1920*1280, 24Mbps. If you using Aunsoft Final Mate for merging, you will get one MTS file with original parameters. But if you merge the MTS files and recode them to MP4 and adjust the parameters to H.264, 1920*1280, 28Mbps using Final Mate, after conversion, you are sure to get a higher quality videos.

Lossless Output: Movie 3.MTS
HD MP4: Movie-4.mp4
So we can make a conclusion, lossless export is not always better than re-encoding, if you set the appropriate parameters for the output format before conversion, you can also get the perfect, even higher quality.
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