Can't help with the DVDdecrypt not seeing it.
But in order to give advice pertinent to your hoped for outcome, it would be useful to know:
When you have the video on a dvd disk, what do you intend doing with the dvd disk? Play it on a standalone DVD player and watch it on tv? or watch it on a pc? or both? (My tv will play .avi files from a usb stick)
I use the free program DVDFlick click here to make my dvds. (if you install it watch out for unticking extras like toolbars and office etc - I can't remember which ones exactly)