When I rented DVD's (haven't done it in several years) I would rip them to my hard drive and watch them later on my computer then delete the files. I think burning them to a DVD is illegal.
Technically, according the DMCA, it is illegal to circumvent the copy protection that allows you to rip a DVD....regardless of whether you own the DVD in question or you are just renting it.
I don't recall how well this claim has been legally tested, particularly with how some court cases have disallowed the validity of click-through EULA's (not that we ever see an EULA to click-through before playing a CD or DVD).
In any event, there's also jurisdiction limitations with the DMCA's posturings: their claims are only relevant to the USA, because that's where the Digital Millenium Act is.
Finally, it can be technically argued that the ripping wasn't done to circumvent copy protection but to transform the medium into a more compact size for facilitating its use on the iPod. Its splitting hairs, but since we are talking about lawyer stuff, its fair game.
When I rented DVD's (haven't done it in several years) I would rip them to my hard drive and watch them later on my computer then delete the files. I think burning them to a DVD is illegal.