divX is awsome.. You can take a dvd compress it to avi from 6gigs to just under 700mb..
The quality is good the audio great. Takes hours to make...
You can use these progies to make them..
1. DeCSS to rip the dvd to your hd(provided you have enough space)
2. FlaskMPEG to compress the dvd
3.VirtualDub to finis the product to save as a avi file
You can start off by going to
http://www.geocities.com/virtualdub
download the program and the readme file will help you get the rest.