I don't know if you guys have tried ConvertXtoDVD... I usually use that to convert my avi files into DVD format for the TV... Even WinAVI works too... I've never really use Nero, only when I need to back up my files or burn pictures...
I think ConvertXtoDVD is compatible to Vista too, I used to have Vista for my laptop, but it still wasn't reconizing alot of my programs, so I changed back to XP...