Throw away the PC and use Handbrake (0.9.4) for the Mac OS X and they put it best...
There's an old proverb in the video encoding world: "Speed, size, quality: pick two." It means that you always have to make a trade-off between the time it takes to encode a video, the amount of compression used, and the picture quality. Well, this release of HandBrake refuses to compromise. It picks all three.It was a straightforward, quick (relatively) and easy to use resource which prompted a VLC update to make sure everything worked out ok. Lots of default presets for output devices and purposes but allows a codec-minded transcoder to tweak as required.
Bit of a cocktail message theme going on suggesting that alcohol and computers do mix. Callisti disagrees.