OK, I see the point about how much you can get on one disc.
My suggestion as to creating an SVCD MPEG on your hard disk via the 'make MPEG' option still applies.
I am not familiar with capturing analogue, but are you editing the film in avi format? If so, Pinnacle will reduce quality again to make an MPEG file. If you captured in an MPEG format, I have a feeling quality will have been lost there already anyway, so the fact that you are starting with a lower quality product does not mean you should work in or output to one, you could just duplicate the loss.
In order to preserve what you've got, I'd work and save in the highest quality I could.
If anybody has any better ideas, or knows more about it, feel free to jump in
Gillian