You're looking for the mkisofs
command. In your situation, what I would normally do is this:
mkisofs -J -r -o cdimage.iso burnthis/
You'll get an ISO image named cdimage in the user's home directory, and it will use Joliet and RockRidge extensions (and no, the burnthis directory itself will not be included in the image).
As for whether it extends to DVDs... I honestly don't know, but I don't see why not. That's a technical-standard-based question, and I'm not sure where that documentation lives.
ilikejam is right... use the lowecase 'r' in the command... changed mine to reflect that.