I prefer the following as it gives me a file size of around 1.2Gb for a 1:30 movie. I find anyless gives me poor quality when I play it on my TV.

Generic.avi.xvid.audiocopy, resolution as close as possible to original DVD (720 x (xxx) after cropping), 1100 bitrate, 2 pass, choosing the Dolby Digital 5.1 soundtrack.

This gives pretty good video quality while retaining the 5.1 surround sound.

To lower the file size, you can lower the bitrate and the resolution or change to the mp3 profile but it all depends on what is acceptable to you on your target playing device.

Hope this helps....