Transcoding a DVD to mp4 (h.264) - Quality? Bitrate?

The real advancement of H.264 is that the image gets progressively softer as you squeeze it, which is a lot nicer than the blockiness you get with other codecs.

Video compression is obviously a lot more complicated than this, but consider the following: with a hand-drawn Disney animation, like The Lion King or Fantasia, the image is mostly made up of blocks of solid colour. Rather than recording the colour of every single pixel, we can simply note the perimeter of a given block and the colour of all pixels within it. For a yoga video, the instructor will be moving around demonstrating the exercises, but the background will probably stay the same. We need only record what changes frame to frame. An action movie, on the other hand, will have plenty busy shots with very few banks of solid colour and lots of movement (including a succession of quick cuts where the image changes entirely). This is a lot more difficult to compress without sacrificing quality.

Basically, the more there is going on in a video for your eyes and brain to process, the more difficult it's going to be to compress.

H.264 is quoted as being twice as efficient as MPEG-2 (at the lower end of bit rates, which DVDs fall into). That's not to say you can compress a DVD to H.264 at half the file size and expect the picture to look identical. You have two generations of compression doing this, and they do stack up. What it means is that if you take a video (ideally uncompressed or very lightly compressed) and make an MPEG-2 and an H.264 of it, the H.264 would probably look just as good at half the bit rate. But I reckon if you ripped a DVD to an H.264 at around the same bit rate you'd probably not be able to see a difference.

As for the MKV/MP4/mov question — I think it's a fool's errand to bank on a particular codec/container/whatever. We've just rolled into a new decade — how much of our computing experience now even vaguely resembles what it was ten years ago?

If you have a bunch of DVD you want to do, I'd recommend you buy the Quicktime MPEG-2 Component and download MPEG Streamclip. There are a lot of options, so it can be a little overwhelming at first, but you sound like you're willing to put in a bit of time experimenting. And that's what you need to do to get the most efficient results. That and checking the box next to 'multipass'.

I ...

... had great success using Handbrake with a slightly modified h.264/MP4 setting using 500kbit for video and 128kbit for audio. This is for content maxing SD size (720x576 pixels). The picture quality is stunning for a compressing ratio of 1:4 (MPEG2 to H.264, e.g. 2GB turn into 500MB).

I use it for transcoding MPEG2 TS streams, DVD rips (here I use the HQ setting) and AVI conversion (for size matters).

I am on a Core 2 Quad hackintosh and get overall around 50frames/sec in speed for the transcode.

Now, I would say for space savings - my personal experience - that for SD content, 500kbit is the perfect sweet spot, for 720p it is 1500kbit, and for 1080p 3500kbit.


PS
I attached the profiles, so you can give it a try yourself: http://www.handbrake.fr/

The ...

... m4v container gives you more options, like AC3 (surround sound) support and chapter markings (used by Apple TV only). For compatibility reasons it would be best to stick with .mp4 - therefore loosing chapter markings though, but gaining support for any h.264 capable playback machine. Handbrake will automatically use the extension .m4v, if you choose chapter support. Those files are really only suited for usage with the Apple TV.

I forgot to mention: The presets do only work with the newest handbrake built (v 0.9.4). It is not recommended to use older presets in newer versions of the software, as vice versa. If you haven´t upgraded yet, do it now.

You ...

... can install Perian (http://perian.org/), to allow Quicktime to play much more formats than it does stock, including .m4v. VLC does the same thing as a standalone player (http://www.videolan.org), as does MPlayer (http://sourceforge.net/projects/mplayerosx/).

Before you start mass converting, check extensively if the quality matches your needs AND all your devices support the ouput file - I learned this the hard way.

Handbrake is great for batch converting - my machine does this now, for a couple of weeks pretty much 24/7 (not forgetting to feed the queue, of course).