Dv-avi to divx problems

[apk]

I am trying to convert dv-avi from my camcorder to divx or the equivalent standard. I have used Movie Maker/DVIO to capture the dv, then I am trying to use Virtualdub to convert it. I have read the guides etc on the site and are following them but i get the following problems...
1. I get no audio at all, there is no audio size predicted while compressing or when it is finished, I have played around with the audio compression/conversion settings but is no better.
Looking at file..information doesnt show any audio either.
2. The picture isnt too good either, I have read that it should be good but it is the same or possibly worse than when i convert it straight to Vcd using TMPGEn (which has audio).

[henk schuifkaas]

For good quality I use a high bitrate, 2000 kpbs or so, 2-pass.
What settings do you use for audio?

[apk]

Thanks for the reply.
I have used a bit rate of around 1650 because thats what I thought would be the highest I could get 1 hour onto 1 cd.
I use 44.100khz and have tried 128 and 192 kbps mp3.
I have also tried stripping the audio to a wav file but it still doesnt pick anything up.