Okay... I'll assume you want to make Video DVDs, and you don't want to do any extra editing.
The only way you can fit more video onto a Video DVD is to reduce the encoding quality (and therefore the picture/sound quality). You can't do that with iDVD.
Also, converting to MP4 was a bad idea, since the videos on your original DVD would have been MPEG2, and the burning process will convert them back to MPEG2. All that re-encoding is going to loose you quality.
For this sort if thing, I use Toast 8 Titanium. Assuming your VHS to DVD converter isn't giving you encrypted DVDs, you can use Toast to rip the MPEG2 off the DVD and then re-burn it at a bit-rate of your choosing. You don't need to go near iMovie or iDVD, and your videos stay in MPEG2 throughout, which is best for quality.
Although... by fiddling around with the encoding settings in Toast, I don't know how much more video you'll be able to squeeze onto a DVD, or how much quality you'd sacrifice. You'd have to experiment.
Finally, personally I stay away from DL-DVDs. They're more expensive, less compatible and less reliable that SL-DVDs (apparently).
HTH
SL