Set to Frame Size only for new clips, not for clips that already exist on the timeline.
Premiere Pro should not ever modify scale parameters once a user has set them.
With my Default Media Scaling set to "Set to frame size", I placed a clip on the timeline. Premiere Pro set the scale to 56.3. So far, so good. I repositioned the clip and scaled it to 86.3. It looked good, and I was happy. Later, I had to copy the clip from my original sequence and into a new sequence. Premiere Pro ran the "Set to frame size" procedure again and set the scale back to 56.3. The clip no longer looked good. As a bonus, it also deleted any Scale keyframes I had set.
I had about 30 clips that had their scaling parameters reset. I had to fix each clip individually. Not fun.
The “Set to frame size” procedure should not run again after a user has modified the scale parameter.
The work around is to set the Default Media Scaling to “None” when you want to copy and paste clips, but this is not intuitive. It took me all day to figure out what the problem was and what the work around is.
Melanie Brandstein commented
I found the fix! Choose frame and right click. Remove Attributes in top of menu. Yes. Yes Yes!
This does not work for me... I simply copied and pasted all of my clips into a Backup Sequence only to find every clip zoomed in and pixelated... I tried playing around with Default Media Scaling/Fit/1/2 resolution but to no avail. I hate this problem it is such a waste of my time and there doesn't seem to be a fix for it online. WTF?!