As of the publication of this guide, MPEG-2 is hands down the most commercially successful digital video encoding format. It's inclusion in DVD and digital television, and even a small role in HD DVD and Blu-Ray, have made it the standard against which other video formats are judged.
High quality MPEG-2 encoders are available to the public for little or no money. If you get an MPEG encoder the first thing you're likely to notice is a large number of settings that are available. Your software may have some presets designed to give you the best results for your intended output, but sometimes you can get better results by changing some settings manually. Before you start randomly changing them it would be good to figure out what they do.
The Digital Video Fundamentals Series is designed to give an overview of various video topics. This guide explains what some common MPEG-2 encoder settings are for and how they're generally set. It's recommended that you be familiar with the basics of digital video terms and concepts, as they'll be used here with little explanation. The rest of our Digital Video Fundamentals series of guides would be a good place to start: