I don't think you need to convert to AVI, it is just too HUGE. I believe a few minutes can take up to 10G hard drive. You need more than 200G for a regular movie (that is for sure).
If you want to burn more dvds on one dvd-r, the easy way is that get divx file first, then convert to VCD format,then use "ulead pictureshow" to produced DVD. Normally, one dvd+R can include 3-4 DVD movies.