These guys have several converters that format video to MPEG4 IPOD.
http://www.alloksoft.com/
I haven't used them to convert straight from dvd before, but works well with taking full size mpegs and formatting to IPOD screen size, takes a 1 gig movie and makes it a 115k movie, to allow several to fit on the IPOD. I checked their site and it looks like they have dvd type converters also. Good Luck...