For best results and something that will actually work here is what I do.
Tools:
http://forum.xda-developers.com/showthread.php?t=467112
http://www.dvdfab.com/
Rip the movie to a folder on your local hard drive. I believe that using an external makes things slower.
Use the converter to open the VIDEO_TS.IFO in the folder that you ripped the movie too with the program from XDA.
Choose your correct settings on the converter.
Let it convert! (it is a bit slow, but it does the job)
PM me if you need help.