Thanks for the reply. When i try the code you provided for mencoder, below is what I receive. I have lame and ffmpeg installed.
mencoder dvgrab-2004.05.13_01-28-55.avi -oac lavc -ovc lavc-lavcopts acodec=mp3,lbitrate=128,vcodec=mpeg4,vbitrate=800,vhq,vm4v -o file.avi
MEncoder 1.0pre6-3.4.2 (C) 2000-2004 MPlayer Team
CPU: Intel Pentium 4/Xeon/Celeron Foster (Family: 8, Stepping: 7)
Detected cache-line size is 64 bytes
CPUflags: Type: 8 MMX: 1 MMX2: 1 3DNow: 0 3DNow2: 0 SSE: 1 SSE2: 1
Compiled for x86 CPU with extensions: MMX MMX2 SSE SSE2
File not found: 'frameno.avi'
Failed to open frameno.avi
success: format: 0 data: 0x0 - 0x3d2d674
AVI file format detected.
VIDEO: [dvsd] 720x480 24bpp 29.970 fps 28771.2 kbps (3512.1 kbyte/s)
[V] filefmt:3 fourcc:0x64737664 size:720x480 fps:29.97 ftime:=0.0334
==========================================================================
Opening audio decoder: [pcm] Uncompressed PCM audio decoder
AUDIO: 32000 Hz, 2 ch, 16 bit (0x10), ratio: 128000->128000 (1024.0 kbit)
Selected audio codec: [pcm] afm

cm (Uncompressed PCM)
==========================================================================
Opening video filter: [expand osd=1]
Expand: -1 x -1, -1 ; -1 (-1=autodetect) osd: 1
==========================================================================
Requested video codec family [qdv] (vfm=dshow) not available.
Enable it at compilation.
Opening video decoder: [ffmpeg] FFmpeg's libavcodec codec family
Selected video codec: [ffdv] vfm:ffmpeg (FFmpeg DV decoder)
==========================================================================
Audio LAVC, couldn't find encoder for codec mp3,lbitrate=128,vcodec=mpeg4,vbitrate=800,vhq,vm4v
Any suggestions?