I came up with these after playing around a lot with various settings. I'm mostly focused on smaller file sizes, and have increased the file size to the point where we can't see any difference when watching from the couch. Any smaller, and we start to see artifacts/pixellation.
video filter: deinterlace slow
video codec: h.264
avg. bitrate: 660 kbps, 2 pass encoding
audio: drc: 2 gain:3
The video filter seems to get rid of jerkiness I get on some DVD's, and the audio settings take care of a problem I've seen on some movies/shows where the music is really loud, but talking very quiet. The gain setting boosts the overall audio so that I can hear it well, even on my laptop or systems with underpowered speakers.
Would anyone else care to share their settings, and why they selected the ones they are using? Thanks!