DVD is already in MPEG format. MPEG II in fact. However, I think you want to shrink the filesize down from 4-5 gigabytes.
I would reccomend AutoGK, http://www.autogk.net/ for conversion of DVD's to Divx or Xvid. These are AVI formats, but I think thats what you're really looking for. Unless you want to convert DVD's to SVCD's.