DVDs that play in normal players, are playing "Authored" MPEG files. Even the "All in One" programs must compress an AVI (or a rendering of the AVI in YUV space ) into DVD compliant MPEG, to make the DVD.

To fit the amount of audio and video information a DVD can hold this information must be compressed. The designers of the compression processes used, were aiming at making the results of this compression, look as close to the original as possible.

You are dealing with a trade-off; the more you try to compress the more there will be an observable effect of the compression. If you have the equivalent to 2-3 hours of audio and video to fit on a single layer DVD, at a full image storage size of 720x480 (NTSC) there should be little if any noticeable degradation in image quality.

That said, a lot depends on the quality of your source. If you have "AVI" that is composed of highly compressed MPEG4, the video and audio data obtained in the rendering of that; may be less than what is needed for good results, even at the highest bitrates.

So the answer to the question is: maybe almost the same, (where you would have to run the AVI and the MPEG side by side to catch any  differences); or to where it is noticeably impacted by the compression.

more