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I had the same audio sync problems where it started out 1 sec behind and got farther out of sync towards the end.
I have since fixed the problem. I believe the problem has to do with the 48kHz to 44.1kHz (or multiple of) audio conversion. Most PC sound cards can handle both 48kHz and 44.1kHz audio streams. My bet is that the Axim can only handle the 44.1kHz (or mutiples like 22.05, 11.025) audio streams properly.
This would explain why the PC plays the AVI without the sync problem.
When I performed the initial encoding of DVD VOBs using XMPEG, I would always have audio sync problems. However, when I used FlasKMPEG to initially convert the VOBs I have no audio sync problems (I used the DVD to AVI guide listed in these forums).
This leads me to believe that the problem may be with the audio produced by XMPEG or the audio frequency conversion performed in VirtualDub.
Hope this helps.
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