I'm not sure whether I should dump this into "Newbie Conversion" or "Off Topic" but it sure is Authoring.

Most of the steps here a basically located in VCDHelp forums and I'm just compiling it into one. Programs I use:

1. Ulead VideoStudio -> For adding lyrics to video clip but no bouncing ball or highlighted text. Cool program since I can also export the video to a .wav file.
2. Dart Karaoke Studio -> I'm not making a CDG based Karaoke but just using their DeVocalizer. Also comes with a "Bass Retrieval" to increase or decrease bass of your liking. Bear in mind that no Vocal Remover software that I know could 100% remove the vocal.
3. CoolEdit 2000 -> For adding mono music+vocal.wav file into left or right channel and music.wav into left or right channel.
4. TMPEGEnc -> To finalize my Video Karaoke production.
5. Nero Burning ROM -> Burn it into a VCD or SVCD.
6. PowerDVD XP -> Viewing the VCD/SVCD that I've created. Comes with the Karaoke function.

This is just a brief guideline. You're welcome to ask or comment any of the above statements.