MPEG2 is the standard for DVDs. Quality will depend wholly upon the bit rate at which you convert your AVI files. The maximum bit rate for MPEG2 on a DVD is 8000Kbps. This will give you about an hour on a single DVD.
Also please bear in mind that the MPEG video will not look quite as sharp on a PC monitor as it will on TV.
COMPAQ something or other with 500Gb Boot Disk, 1Tb external Firewire Disk, 4Gb Memory and a super duper sound card, 19" TFT Monitor etc etc etc
Sony TRV33e : Sony TRV310e : Canon XM2
Sony Vegas Studio editions to v11
Remember, there is always more to learn than there is to teach.