I had written out a wonderfully worded reply to this when iCab crashed as I was getting the necessary links, so here's the abbreviated, written-while-slightly-annoyed version.
Converting DVD -> DivX/MPEG-4 -> DV is quality killer. If you have the Quicktime MPEG-2 component you can use MPEG Streamclip to cut out what you don't want, there is a free mpeg editor called mpgtx (search VT), but I don't know if it's reliable.
The menu's are hard, no good editors on OS X, direct copy (of the .ifo files etc.) may/may not work, might need to have the title in the same number of pieces as on DVD disc.
Don't forget the 4.something GB limit on DVDs, unless you have DL media + burner.