Convert virtually any video into a DVD-valid MPEG2 stream

mencoder -oac lavc -ovc lavc -of mpeg -mpegopts format=dvd -vf scale=720:480,harddup -srate 48000 
-af lavcresample=48000 -lavcopts  
codec=mpeg2video:vrc_buf_size=1835:vrc_maxrate=9800:vbitrate=5000:keyint=18:aspect=16/9:acodec=ac3:abitrate=192 
-ofps 30000/1001 -o output.mpg input.extension

Options you might want to change:

scale: 720:480 for NTSC, 720:576 for PAL
ofps: 30000/1001 for NTSC, 25 for PAL
aspect: 16/9 or 4/3 depending on your video