For anyone looking to play a DVD iso on the PC, you can create a "fake drive" and "mount" the ISO using Daemon Tools.
http://download.cnet.com/DAEMON-Tools-Lite/3000-2646_4-10778842.html One thing to note, the last time I installed this it brought with it one of those stupid browser toolbars, so remember to read every page of the installer and uncheck any extra crap it wants to install.
You will of course need to have the appropriate DVD decoder software as well, so for someone without a proper DVD drive on a laptop maybe its not worth the effort.
But for anyone wanting to simply watch the ISO on your computer without burning a DVD its a good option.
I am down for the 720P version too, AVI or ISO doesn't matter to me, file size also doesn't matter to me. =)
Oh also, converting AVI(compressed) to DVD will result in double compression, as you're taking a compressed source and recompressing it with a different codec, maybe not really noticeable, but just thought it went along with the whole dvd vs avi conversation. So DVD will be a larger file and probably a little worse image quality as well. 🙂