hambalan's formulas are very useful and handy. In general, you should try for anywhere between 1-2 megs per minutes of original video. The beauty of Vdub (and similar programs) is the ability to adjust the settings to suit your preferences. Personally, my hearing has degraded to the point that I can bias the encoding to the video side, putting more emphasis on higher bit rate and smoother, richer playback.
If you are using PocketMVP, try downloading some available trailers and checking on the encoding settings of the short videos. This will give you a benchmark to start your encoding experience.
To find the settings, first load a clip, then choose File - Media Info. To view perfomance stats, try Settings - Configure - check "Show dropped frames" box - Save. Play the file and the stat window will pop up afterwards.
Check
here for trailers.