DVD Transcoding Parameters

In the ongoing saga of getting my Myth box up and running, I’m finally beginning to work on DVD transcoding. Currently I’m using transcode with the xvid4 codec, dumping theaudio directly (to preserve the DD soundtrack) and getting pretty happy results, but there are a couple of things that annoy me. I’m playing back with xine, and I find that I have to manually adjust the aspect ratio. As well, even after I do, I have a black strip (akin to a pillarbox) on the lefthand side of the screen, representing screen space that’s not being used. I get no such artifact on direct .vob playback.

Anyone happen to have any suggestions for getting rid of these issues, or other suggestions for improving video quality? I’ve considered getting the x264 encoder, but what I read is that it’s not necessarily better quality than xvid is, and I’m more concerned about quality than compression. (Going from 5-6GB DVD rips to 2GB is plenty of compression.)

Also bonus points for anyone who can tell me how to set new transcoding profiles in myth for the DVD ripper. I know how to do it for the telivision settings, but those seem to have no relation to the DVD settings. My overall goal is to offload all my media onto this box eventually so I no longer have to mess with discs except when I first get them.