OK, this might be a roundabout way of doing things, but it works for me. I use DVDshrink 3.2 to rip and compress the dvd - its claimed to be used for backing up your dvd collection (ahem) and it has dealt with all encoding so far. Using this application you can do away with any superfluous information on the disc eg foreign languages, subtitles, trailers, intro screens etc. You can also "re-author" - this effectively means you can select a segment of video from a certain point (frame) to another. Then I use handbrake to convert the output files from DVD shrink. On handbrake I select the output file to H.264 (i-pod) and set the screen resolution to 320x240. On a long video I may reduce the frame rate on the video settings, but most other stuff I leave as default. With these settings I get a file size of about 700mb for a two hour movie. The image converter software bundled with the walkman accepts this file and will reduce the file size further - about 450mb. I hope this helps.