ViviF0rever & DarkNephree, all you need to learn is
here. Despite that fact that you have one thing in common (you're newbies), it sounds like you have two different goals. Vivi, you need to study the Convert and Author How-to's. DarkNephree, you just need to review the DVD Rip How-to's.
To address Vivi's initial question, as Sid59 said, there is no getting around the requirement to convert your XVid & DivX files to Mpeg2. TMPGEnc is a benchmark program for doing this, and should be representative of what is required. Perhaps you can try lowering the desired output bitrate (quality) of your MPEG2 file, and see how it goes.
Thinking outside the box, if you have the right hardware, like say, a video card with TV out & and a real-time external MPEG capture device, you
might be able to play the Xvid or DivX file on your computer, and do a real-time MPEG2 capture back to your PC. (Video card out -> Capture device In -> USB in). Similar to what this gent did:
loopback