I now have Kinoma working for full length movies with excellent quality and reasonably sized files. ONLY DRAWBACK is it means buying decent programmes!
I am now using DVDCopyexpress to rip to VOB files (about $45) then Dr Divx(about $48) to encode the VOB to avi. on the full size mode. This results in an avi about 500+MB which can then be converted using Kinoma to about 400mb depending on the quality you want. I guess you can get two moderately looking movies on one 512 SD card, but I prefer better quality.
This is not rocket science, unlike the Vdub and other decoders which did my head in and wasted many hours! So it costs you to get the decoders, but what the heck, time is money!