Since the default settings of TMPGEnc will not allow you to convert xvid to any other MPEG-compliant format, follow this simple step and you'll be on your way to creating a (x)vcd.

In TMPGEnc, click options >> environmental setting >> VFAPI plug-in

Right click on DirectShow Multimedia Filter and up it's priority to 1.

Then use TMPGEnc as you would ordinarily.

When you have finished encoding your xvid to another format, be sure to restore the DirectShow Filter priority back to -1.