Here is another perspective, as applicable to me and many others, why to Back Up our DVDs:

In the past 3-4 yrs, I have bought hundreds of Indian DVDs. Needless to say, neither I or anyone else would have watched all these DVDs (2 DVDs a day is too much). I bought them, mainly for collection purposes. Assumption was that DVD media lasts much longer than VHS. Now we are finding out, that's not the case most of the times with Indian DVDs. Majority Indian DVDs have developed disc rot and don't play on our DVD players any more. Some have rotted a little and some have rotted more.

Now, we start watching a movie DVD and frustatingly find out the DVD won't play midway through. There is pixelation, freezing, pauses and complete crash.

That is where DVD backup comes handy. Find a DVD ROM that's most forgiving and start DVD backup using DVD fab or some other software. Keep the setting to "Ignore All Reading Errors" and "Try 2 to 9 times at each failure".

Good DVDs will back up in 30 min.

Many DVDs that are somewhat rotten, will succeed in 3 to 10 hrs (with errors). After running the program, error message will show how many blocks couldn't be copied. I got errors somewhere from 24 in some cases to 42000 in some cases. DVD with 24000 blocks failing, resulted in 5 to 10 min of pixelation/ freezing problem, audio runs smoothly, and less than one minute of total run time missing. Not bad for a DVD that you couldn't play at all, midway through. IDEAL for those cases where you let the PC do the frustating work and you watch the DVD next day and may be save the fixed version (or buy/ exchange a new limited life DVD again). Resave every 2-5 yrs depending on life of the media where the movie is saved.

Badly rotten DVDs won't succeed, in which case you can cancel the run after say, 3-10 hrs. These DVDs will have to be replaced.

Can you provide all the steps (starting from "combining two XVid avi files" to getting vob files OR is there any link where these steps are mentioned?
Which software did you use other than TMPGEnc?

my "dil chahta hai" dvd has rotted now,
does not play after dimple kapadia's birthday celebration scene