I know very little about this stuff. Please bear with me. I've captured .ts files using CAPDVHS and I have, on a couple of occasions, used HDTV2DVD to generate .mpg for subsequent burning using WINDOWS DVD MAKER. The reason I used DVD MAKER, was for its menu capability, but it has a few quirks that have cost me some bucks in wasted discs. While learning about this stuff, I had read that SVCD2DVD is the full blown version of HDTV2DVD, but with menus and other features, so what do I do? I purchase SVCD2DVD, complete my first project and wind up with crappy video quality. Worse (much worse) than with HDTV2DVD. My source .ts was a 3 hour, 14GB HD production, but the resultant DVD from SVCD2DVD was 1.2GB of a hard to watch resemblance of the original. I've tried to figure this out, and have concluded that I must have purchased the wrong thing. I love working with SVCD2DVD, but I guess it wasn't designed do what I need done. Have I blown it? If not, how do I accomplish it(producing an HD quality DVD)? I'm an old dog who can still learn new tricks, but very slowly, so please forgive my ignorance. If you respond, please speak as much on an elementary level as the subject will allow. Thanks for even listening.
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First, you may wish to read "What is DVD" in the upper left-hand corner of this page. There you will find that DVD specs only allow a few resolutions. If those resolutions are not your definition of "HD" then you are out of luck.
Assuming that this is not a problem for you, then the next fact you need to know is that quality is a function of several factors. Resolution is only one. Bitrate is another. Within limits, higher is better. Beyond some value, you encounter diminishing returns. So, in your SVCD2DVD example, the resulting file was fairly small, and the quality poor. You can try with a higher bitrate to see if things improve. Generally speaking, a higher bitrate (for a fixed resolution) allows tracking motion with higher precision. If scenes are breaking up into blocky artifacts during motion, that's the standard symptom of insufficient bitrate. For a 3-hour video, you'll generally need to spread out the video over 2 DVD5 discs, or a dual-layer disc, in order to fit everything with reasonable quality. An approximate rule of thumb is 2 hours of good quality on a DVD5 disc. In your case, you've shrunk 3 hours' worth of material into 1.4GB, so it's not surprising that it looks crappy. That's the expected result.
Another point is that your .ts file may not have needed re-encoding at all. Most cap boxes produce a mutant form of mpeg that only requires moderate tweaking to produce a DVD-compliant file. A tool such as MPEGstreamclip, for example, can often perform the necessary tweaking. That avoids a reencoding altogether, further saving quality. You might want to look into that option.
All of the foregoing presumes that your ultimate aim is to produce a DVD that is playable in standard standalone players. If all you want is something that is playable by something somewhere sometime, then you have more options.
Others will shortly chime in with their input, I'm sure, but this is hopefully a useful start for you.