Try this, it does wonders:
Use preset values or change the resolution to whatever you see fit. Change the bitrates and it allso has 2 pass encoding and various file formats available.
And...freeware
http://www.pocketdivxencoder.net/EN_index.htm
Btw, I wouldn't recomment spb dvd, it encodes into .wmv and those tend to be choppy videos and have heavy loads on the cpu during playback. With this program the formats are better, you can have your movie playing seamlessly and still "tab out" to do something else without creating a lot of lag.