I've been testing on Handbrake 0.9.4 to find a good setting. Here are some more results. (Current Handbake on Win7 x64)

No presets used. based on Normal.

Picture: direct from DVD (720x576, 1.78:1). Anamorphic set to None. No cropping done. Keep aspect ratio and original resolution.

Video Filters: Nothing changed or edited

Video: H.264 (x264), Constant Quality (default)

Audio: 5.1 Audio channel, AAC/Dolby PL II (this is based on the new Wiki advice that AAC will decode using the DSP, AC3 is decoded using CPU). All default here: Sample rate 48KHz, Bitrate 160kb/sec.

Advanced: deselect B-frames and CABAC (Wiki advice)


Result: plays in KMplayer with mplayer, video runs ~ a few frames per second slower than audio as before. An improvement on straight AC3, but still no luck. H264 is a real problem, I don't see how people can use it with DVD quality sources unless dropping the resolution or cropping.

second run using MPEG-4/ffmpeg for Video, and there was an unacceptable drop in video quality. Back to Xvid? I'd rather not, but the best option so far seems MKV/AVI + Xvid + AAC.