I know this might be a bit late to answer but...
1. What is your video fps?
2. Are you transcoding?
3. What is the network card you use? is it Intel? if not can you try with an Intel NIC to get the input?
4. Have you tried to record the incoming stream and the transcoded stream (if any) at the same time and then play them back side by side to see if there is any pixelation in either the input or the output?
And yes there are many ways to edit Wowza settings to reach your desired results you have to edit the application and change the settings related to chunk size in seconds and chunk numbers, make sure that the length of the chunk is a multiplier of your fps, for example, 25fps video can't have chunk with a length of 3 seconds. the number of chunks and the length is related to your customer internet connection as well, for example, long chunks will take longer to load and need faster internet for smooth playback.
But first I suggest to make sure the input is ok, in my case I was using HP Z820 as a GPU transcode test rig, and always the output was pixelating plus the streaming engine service would stop for no reason and with no warning in the logs at all, I finally understood the onboard NIC was somehow not compatible with Wowza so I installed a 4 port 1G NIC and all was solved.