search versiontracker.com (os x tab) for VCD (video CD) utilities. I think I've seen a couple that will let you do it.
also, Toast Titanium includes a VCD codec--from iMovie, you can select 'export' and then follow a couple steps to export to Toast VCD. That exports, then Toast opens and burns a VCD.
my experience has been that a VCD's quality won't be better than your divx files.