Yes, Nero will convert just as you say and it’s the reason I don't use it for converting video.
However, what you're asking for can't be done... well, not in the manner you think, anyways. There is no such thing as lossless compression or conversion. Software available to "home" users aren't as good as what studio's use, although if you have enough money, you could buy the same software. Not a realistic choice though. Still you couldn't do it lossless. You'd be surprised at how good some home software is with creating decent video DVD’s and truth be told, some are decent enough that you can't tell the difference, or there's not that much difference to make a difference while viewing on a TV screen.
Before I go on, I want to let you know that I also mess with video. Not professionally, but as a hobby. My main "thing" is converting Japanese dramas (.avi format) to DVDs with subtitles. In fact my desktop was built specifically for doing dramas. Most Japanese DVDs I buy don't come with english subtitiles, so I had to learn to convert just so I could watch them! I've used all the apps you’ve listed, and many more you haven't. I've even tried professional applications costing thousands of $$$. Luckily I didn't have to pay for them just to try them as I have friends in the "business".
What I ended up sticking with was Tmpgenc 2.5. Tmpgenc takes an .avi, for instance 700mb, and converts it to a DVD compliant mpeg of about 1.3gbs... almost double the size of the avi file if you use 100% Constant quality, which is single-pass. If you use double-pass, the file is even larger. Tmpgenc also reads subtitles, so I normally add those via srt, sub, or ssa files supplied by kind fansubbers on the net.
Anyways, once converted, the mpeg is imported into Tmpgenc Authoring Works 4 where menus/editing takes place. In Works 4, you can add as many mpegs as you want depending on what kind of compression you're willing to live with in the final DVD. I normally go with 4 or 5 episodes and then compress until they fit on a 4.7gb DVD disc. Most Japanese dramas contain about 11 episodes depending on how they're converted from the vob files. Each episodes run anywhere between 500 to 700mb average. Add everything up... vobs, avis, and mpegs after conversion, and you end up working with a total of about 35gbs per drama!
HERE’s (link expired) what I consider a "highly" compressed wma file that was converted for a guy on this forum who thought he had problems playing video on his computer. I made this wma by first running the original .avi through Virtualdub using the text filter for the subs. I then set Virtualdub to clip the avi to the length I wanted and then saved the clip to my desktop in avi format. Because I just wanted a sample and didn't really care about compression, I ran the avi through Windows Movie Maker to create the wma file. The wma is only 5.6megs, and although it has relatively poor brightness/contrast compared to the original file, it really isn't that bad of a sample. Play the file full-screen on your computer and tell me if it looks as bad as what Nero puts out.
There’s a ton of different things to learn about video conversion/editing, and truthfully, this is not the forum to be visiting to learn what you want to learn. I just happened to come across your thread and replied to it but you would have better luck learning at places like afterdawn.com, doom9.org, and several other forums. However, if you have more questions for me, ask away!
Edited by makai, 18 August 2009 - 12:07 PM.