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I use FairUse and there is a "sticky" post guide on how to encode - FairUse do a free lite version that works equally well and I normally allow around 100MB per 30mins of video. The only thing you'll need (if you don't already have it, is the DivX codec which is free to download.
I've tried a few others but FairUse is the best I've come across - the onlty thing you may find especially if its a movie and you are doing a 2 pass encoding (which is recommended) is that its best to start it running and go to bed - it takes a while and FairUse will shut the PC down once its finished.
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