Is it possible to encode a SVCD with AC-3 sound and fit in 2 cd's with good quality??
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SVCDS cannot use AC3 audio. Practically speaking, the best quality you are going to get with SVCD is a dolby surround downmixed stereo signal which can be decoded into either dolby surround or prologic surround, depending on your hardware setup. SVCD does support multichannel mpeg audio which can preserve the 5.1 signal and provide quality as good as dolby digital, however, you must have a Philips dvd player and multichannel mpeg audio receiver. Also in order to be fully compliant and to get the full 5.1 signals you would have to author the svcd in linux. So all in all, for most people multichannel mpeg audio is out of the question.
As far as your quality question. Quality is relative. For shorter movies you can still achieve a decent bitrate level and keep it on 2 cdrs but the resulting quality can only be judged by you. Generally speaking I would say yes, many movies can be fit on 2 cdrs and still look very good.
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