Which will have better quality;

a movie compressed to a Divx file played on a Dvix stand alone dvd player,

or

the same Divx movie file blown back up through NERO played on a regular standalone dvd player?

If your movie is already in divx format, then playing it back on a stand alone player that has divx capabilty is the better choice. Any conversion will compromise quality somewhat, and Nero is a poor choice for conversion anyway.

I use nero because it is so easy. It does take 2 to 3 hours to convert a divx file.

What is your do it all go to file conversion burning software?

I use a program called Procoder for avi to mpeg2 conversion, then DVDLab Pro to put it into dvd format with menus. Combined, that is about $750 worth of software, so you may not want to follow my lead on this.

A lower cost alternative that uses a good encoding engine would be something like TMPGenc Author 3.

And there are some free programs that use good encoders as well. FAVC is one, and if you use the HC encoder that is included, you will have excellent results. http://favcfavc.googlepages.com/ Make sure to install AviSynth and Net 2.0 (if you don't already have it). There are links on that page for those two necessary items, and both are free.

Encoding times depends primarily on the speed of your cpu. Dual core cpus can speed this process up if the encoding programs are set up to utilize both cores.

I normally use ImgBurn to do the actual burns to disk. It is a free program, and I highly recommend it. If you are not familiar with it, look through the guides at the ImgBurn forum.

For the most part ConvertXtoDVD works well, especially for the majority of files that most seem to be concerned with, Xvid downloads with VBR audio. It's fast enough, uses pulldown (Nero and some others do not), produces a rudimentary menu if needed, and almost always produces results that are in sync. It can also do an acceptable job of converting PAL DVD's (movie only) to NTSC. There's only so much that can be done with the the quality compromised AVI's that folks seem to download.