Out of the 15-20+ media encoders/muxers/authorers I use, I use this particular one for creating DVDs (encodes any video, or set of videos, straight to a DVD, DVD Folder, or ISO file)
This movie is 2h 32m, I'm burning to a DVD folder
If I choose the fit to disc setting for DVD5, The output file size will be 3.94 GB
I'm wondering, should I settle for a 3.94 GB DVD folder
or Should I encode it to a 7.27GB DVD folder, and use DVD shrink (deep analysis) to shrink it down to 4.35GB
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"Do the Least Harm!"
So that means, encode/convert (lossily) only the minimal amount of times necessary to get to your destination (usually this means ONCE).