TMPGEnc converts *.AVI file to MPEG1, the format which is used in VideoCD. Using variety of option in TMPGEnc, you can compress your video file in high quality. TMPGEnc enables us adjust bitrate, quantize matrix, GOP structure, Interlace and many other parameter so that you can create most appropriate movie file depends on your purpose.
More info:
hxxp://www.tmpgenc.net/e_main.html

Thanks, Fisher. TMPGEnc is a great program for converting avi's. :)