Thanks for mentioning Handbrake everyone. I've been experimenting with Nero Recode (with AnyDVD), but haven't found a set of options that the N800 can play back yet.

However, a little playing with Handbrake and I've got a set of options that make very nice N800 clips.

I tried to make the clips .avi format (which seems to be a more commonly playable file container for videos), but the clips seemed broken, and were not playable on the N800 at all, so I've stuck with .MP4.

I've altered the profile that Rebski gave as follows:

Widescreen DVDs are 16:9 ratio (width:height). 400x240 is actually slightly less "widescreen" than it should be, so I've altered it to 400x224 which is closer. That means that people don't look a little too tall and skinny, and the black bars are slightly bigger at top and bottom when you play it back. Maybe a helpful video pedant can apply a little source cropping to make it match 16:9 exactly, but as I understand it you want the output height and width to be multiples of 16, so I used 400x224.

"Normal-screen" DVDs have 4:3 ratio source, and so I've included a 320x240 profile, which will fill the screen vertically, and have black bars at the sides. I haven't tested this profile but it should be fine.

In both cases I've moved the audio and video bitrates down. I can't tell the difference playing them back through the N800 with headphones (tested with a Matrix Revolutions clip).

Hope its useful,
Steven

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Edit: In the attached profiles I dropped the video bitrate from 500 kbps to 250 kbps. I think my initial setting must have been ignored, because the test clips I made looked very good, but the files are big. It is actually pretty obvious when the bitrate is down at 250 kbps, so I think I'll stick with 500 kbps in the future!