You don't really create the files or formatting that the DVD standard uses -- this is done automatically when you place any video in an authoring software to create the DVD disc. Common software that authors DVD discs is Nero, Roxio, DVD Flick etc.
What the authoring software will do is create three types of files. It creates the main video files using the MPEG-2 codec, which is wrapped in a VOB container and the audio can be chosen to be either AC3 (Dolby) or MPEG-2 audio or a few others. Small IFO files will also be created, these are information files that contain info about chapters and language and link up with info contained in the VOB files. Then there are BUP files created, which are simply back up files for the IFO files.
The video standard for DVD is MPEG-2 at a resolution of 720 x 480 pixels (NTSC) or 720 x 576 PAL.
Bitrates are dependant upon the quality required and can be selected in the authoring software.
The main thing to keep in mind when you finish editing a video that you are planning to make into a DVD is to either go straight to the DVD authoring section of your editing software or make a master that is of the DVD standard. If you make a master below this the quality is lost.
