Your problem is that an AVI file downloaded from anywhere by itself is not automatically DVD-compliant. As already stated, it has to be converted with DVD-specific settings.
One tool to do this is 'tovid', it did work for me. It even allows to create DVD-menus. 'tovid' will actually create the entire DVD filestructure with all neccessary files and folders.
You don't have to care about TS_AUDIO anyway, even commercial DVD's do not use that anymore (they could, but they don't).
Hope this helps,