I think this is the correct forum for this question, if not I apologize in advance. Is it possible to do effective CG at DV resolution? For example green screen work or person rotoscoped/morphed into a tree, 3d designs with live action.

Yes all of those are possible. Greenscreen isn't easy since most people don't have a decent screen setup and the DV codec is notoriously hard to key (only one sample of color per 4 luma). It can certainly be done though!

Take a look at the trailer here:
http://www.ancanar.com/trailer/

These guys are a great example of combining CG background plates with greenscreen material.