Best is a relative term, as cost and quality are important factors. In a sense you are asking about three different apps, as you'll need to capture, then encode, and finally author your DVD. There are some all in one solutions, but I'm not to familiar with them. I did however, buy my aunt Adaptec's VideOHDVD, which captures and encodes via hardware, and they bundle MyDVD to author the DVD. Its fairly straightforward, and reasonably priced at about $120. Then there is the free route like using VirtualDub for capture and encoding, but then you'll need something like DVDLab or Encore for authoring. And finally, if you have a Mac you already have just about everything you need already.
It all depends on your experience level and budget. A good place to learn about this stuff is
VideoHelp.com.