I use DVD Decrypter in IFO mode to rip, then use AutoGK to encode to xvid/divx. This is pretty automated and only requires me to insert the DVD and click rip, then when done its only something like 3 clicks to encode. Not the greatest method overall, but it works for me.
I'll be watching this thread though, to see if theres better solutions out there.
One way to keep it a single file with menus and everything else is to use DVD Decrypter in ISO mode-Read and load that ISO/MDS with whatever virtual software you use. Note this is still uncompressed and will be about 8GB, but I like to do it when I want to keep certain features but I don't know what ATM so I rip the whole thing to ISO, then I can write IFO files from that ISO that I encode.