Can you recommend the best software to accomplish this? Are there any good freeware appz? If not, which commercial ones do you recommend?

svcd2dvd will support this and many other formats.

If you take a look at www.videohelp.com/tools, you can find multiple tools for converting avi to dvd, and there are rankings and comments on each software, as well as information on freeware, shareware, and commercial applications. It is a personal choice. Some folks like virtualdubmod, some like tmpgenc, some like convertx2dvd, etc...

Thanks for the info. Does it usually take about an hour to covert an Avi to dvd? I am runing a 2.1 ghz Intel Core Duo with 2 gigs of ram.

Conversion times depend on how long your original avi is, and which converter you are using. Some encoders are slower---TMPGenc for example (good quality though). CCE Basic is a very good mpeg encoder, and one of the fastest, but is not the easiest to use for a beginner.

I normally use ProCoder2 and it takes me just under 3 hrs to encode a 350mb xvid file to mpeg2. I'm using an A64 2.2ghz with 2 gigs of ram, and always encode to a separate hard drive. A newer Intel processor would be a little faster.

If you want free options, look at SUPER or MediaCoder
The SUPER website is extremely annoying, but you will eventually get to a download page.

The side harley has recommanded to you is the best source of information to your question.