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How to reduce WMV video file size before burning into DVD?

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Hi all,

I need some help with regards to the following issues in video editing and burning:

1) Can you suggest a good and free video editing software which can also preferably directly handle various types of raw input video format such as MPEG2 ?

2) My videos are in the format of MPEG2, and they have a large file size. So i normally convert them to WMV or AVI format resulting in smaller file size. I use these smaller file sizes for editing and burning into DVD. Hence can you suggest a suitable converter to convert the videos between different formats such as converting from MPEG2/MPEG to WMV/AVI ?

3) I realized that even after converting my video files to WMV format the file sizes are still quite considerably large. Is there any software that i can use to compress the video to obtain a smaller video file size without compromising too much on its video quality ? I want to compress the video files without compromising excessively on its video quality so that i can burn them onto DVD's and watch it using television.

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