An easy way to convert video files is to use this small utility called avi.NET. It has a lot of features when converting video files from MPEG-1 (VCD) or MPEG-2 (SVCD/DVD/HDTV) to a standard avi file.
avi.NET is a small but very useful application that can convert the formats mentioned before to avi files, compatible to be played in any kind of standalone media player, like a home dvd player or other devices.
The usage is very simple, you just have to choose the input files (in mpg, vob or ts) and then choose output options like the destination folder. This software is compatible with Windows 2000 and later and you can download it from its official web page.