This is how to cut out a part of a video file using ffmpeg and then encode it as divx using mencoder:

ffmpeg -ss <start> -t <duration> -i <input-file> -vcodec copy -async 1 <tmp-file>

mencoder <tmp-file> -ovc xvid -oac mp3lame -xvidencopts bitrate=687 -o <output-file>

Or

ffmpeg -i tmp.avi -target dvd tmp.mpg