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You obviously have no understanding of DivX.
DVD's are encoded in MPEG 2. DivX is MPEG 4. They are completely different codecs. MPEG 4 allows for far better compression than MPEG 2.
Let me ask you this. Can a 100kb JPEG file look as good as a 1 megabyte BMP file, of the same image, at the same resolution? The answer in 99% of all cases is a resounding yes. >>
Sorry, but this is an extremely bad comparison. One reason is the fact that you are compressing a compressed format. So Divx doesn't look near as good as DVD, unless you go for super high quality and then you get only about 1/3 compression. If you encoded raw film into MPEG-4 it would be awesome, but you can't do that, at least with DVD's. I have tons of Divx movies, but I only watch them to see if the movie is good. If I like it, then I go out and buy it. Too bad the RIAA/MPAA won't hear of such things. Next thing you know, they will make movies only to be able to be played on one player.