It will stop you dead in your tracks before encoding as it checks for the presence of the internal burner's firmware.
Once again, King Solomon is at work. The price uptick for the superdrive and iDVD software is not excessive compared to the current base models, but what the ^&*?/ is APPL doing for those of us who bought a G4, fast iMac or TiBook and would like to buy the external Firewire version of the Pioneer Superdrive?
At some point, you almost have to cheer for the hackers.