Krayzie116: First off I want to apologize -- this isn't an answer to your specific question. Or at least not a direct one, but hopefully it will give you a few pointers where to look.
The problem is that part of my solution requires a couple of currently Mac-only apps. (Hopefully you can find similar ones that do the same thing under Windows)
In a nutshell, here's the complete workflow I use to take a DVD and create an iPad-compatible .mp4 that plays in the Videos app, complete with chapter markers, artwork, metadata tag info, etc. It involves using three (or four) free apps, but it has yielded 100% consistent results for several dozen of my movies I've encoded so far.
[Note: By describing this process I'm not condoning theft of media you don't own, bla-bla-bla...]
1. Rip DVD to .mkv using the (currently free) MakeMKV app.
This app is available for Win/OSX/Linux and will extract DVD and BluRay discs. I've only ever used it on DVDs under OSX. The reason to rip to .mkv is to guarantee that the DVD chapter divisions are preserved.
2. Use Handbrake to encode your .mkv file to .mp4.
I'm not going into specifics here since everyone seems to have their own opinion about the 'best settings' for HB. All I can suggest is that you stick within the Apple-specified parameters for what is considered a valid .mp4 that will play back properly on the iPad. (see their iPad Features page for more info)
[Well, ok. Maybe I'll share after all. I tend to reduce my movies to a horizontal resolution of around 640 while maintaining the default aspect ratio of the file. This means that the vert. resolution tends to vary. Rather than playing with encoding bitrates, I usually just pick a Quality level around 55 and set the audio DRC to 3.75. More about the audio levels in step 3. Why only 640 horiz. resolution? Mostly because it keeps the resulting movie files relatively small, in the 400-700Mb range. On the iPad I find movies at 640h are usually adequate and with the smaller filesize, I'm able to keep more of them on the device than if I'd encoded them at something higher like 720p]
3. Optional: Boost audio gain in .mp4 using aacgain.
Because of large dynamic range of DVD audio, folks often complain that the resulting ripped movies are too quiet. This is somewhat of a long-debated technical discussion among the HB creators so I won't get into it other than to say that the resulting .mp4 of my movies are often close to inaudible without headphones or external speakers, even at max volume. A shame really since the iPad's internal speaker is really quite powerful.
Anyway, one way to fix it is to google for a tool called 'aacgain' which reads/analyzes/boosts an .mp4's audio track. I tend to use a boost factor of 8 or so.
NOTE: This is a command-line tool so you'll need to be comfortable using terminal/shell to run it. I honestly don't know if there's a Windows version. Under OSX I was able to compile it from source code. It's also possible that someone has written a GUI-wrapped version by now, but I just use the cmd-line version.
Anyway, the end result of this step is that your .mp4 will have a much louder soundtrack that plays comfortably through the iPad's internal speakers.
4. Use Subler to add chapters, art and metadata info to .mp4
Google for Subler. This app makes it really simple to enable chapters and add artwork and metadata info to a movie file. Once more the bad news: this app is currently available only for OSX. Again, you might look around to see if a suitable Windows replacement exists.
Subler uses the online tagChimp service. Just type in the title of your movie and hit search. It will go out and look for artwork and movie data matching your title and add it to your file if you accept the result.
Finally, enable the 'Chapters' checkbox in the tracks display and save the movie.
Now you'll have an iPad-playable movie (of decent audio volume) with chapters, artwork and metadata info much the same as movies purchased online.
Sorry for the way-too-long post for a solution that may not be directly useful to you. Hopefully some of this is at least helpful to others.