i have been using the free converter PSP Video 9 since ages, only for pc and mac though.
converts to more or less all known formats to smaller file sizes and custom screen sizes.

most users dont experience any problem, but if you do just have a look on the forum they have (read first) section.

I might be able to post some settings as soon as I put my computer back in one piece.

Thank god for the N900 meanwhile.

Just google "free movie converter" if you dont this one.
There are tons of them, some good some bad.

Or if your desperate/ crazy and want to go for a fullblown media solution that will take over your computer buy NERO