Part 1
The most reliable (quality driven) product that I have used (and I do a lot of video editing and conversions), is a program called TMPGEnc (version 3.0 XPress), run a search on google to find their site, or click:
http://www.tmpgenc.net/
They have a free version (2.54) which you can download, it's a simple program, but can be customised to a great extent when you get familiar with it. However, as a beginner all you need do is load your MPEG4/Divx/Xvid and set the output DVD Pal. The rest is simplicity.