What format for raw encoding? VOB, AVI or MP4

[Vman94]

Ive been bothered about this for a while. I have some DVD's to rip, edit and encode in multiple formats in Sony Vegas. I have the DVD's and need to cut up clips, add a splash and encode in MPG, WMV and MP4 formats. Should i Encode the vids from VOB files in vegas or put them in AVI format(in AVG) or MP4 format in handbrake to start. Just not sure sony vegas de-interlaces it properly in vob format or it would be obvious. Any opinions or suggestions would be greatly appreciated. Also note that the bitrates will be lowered for the final encode.

thanks again.
Vman

[hech54]

Leave them as they are....MPEG2....but convert(not really) the individual VOB files to one giant MPEG file with something like VOB2MPG. VOB files are very useless when you soon find out that one of the clips you want spans across 2 VOBs.