Toast Titanium can will convert anything that plays in QuickTime to a DVD movie. So if you have the codecs installed Toast will burn them. _BUT_ The best app imho for taking AVIs and turning them in to DVD movies is VisualHub.
For ripping, shrinking, and burning back ups of my DVD movies I use DVD Fast Copy. It's expensive but it works perfectly. You could also try MacTheRipper and Toast Titaniums built in DVD shrinking application Popcorn, Fast DVD Copy is a much better solution though imo.