I use a program called Handbrake ... it can keep the audio tracks separate ... ie: same as original instead of forcing them into stereo etc. It can maintain multi-channel audio. DTS I'm not sure about however .. it may convert it to aac multi-channel. Pass-thru I believe is the keyword for maintaining original.

With Handbrake you are converting to X.264 (& it uses the most advanced X.264 technology .. far beyond what QuickTime's H.264 capabilities can handle as X264 appear to gone ahead in leaps & bounds ahead of most other H.264 developers in recent 12 months or so. But also you need to keep in mind overall compatibility all-round .. something I wrestle with. I've made personal notes about what QuickTime cannot handle. VLC no problems. Nero I believe is also 'reasonably' up to date .. how much so I don't know.)

With Handbrake you have option of mp4 (it uses the .m4v extension, not mp4), or Matrovsky .mkv, or .avi (.. the least preferred option due to avi's limitations with H.264 compatibility with various audio)

Handbrake can maintain chapters also. However audio is limited to 160 kbps unless you use pass-thru AFAIK. However you can have multiple audio tracks. And adjust levels. And have multiple subtitles. I've never used subtitles.

It's a good idea to set your own custom encoding profiles .. requires some experimentation of course which takes time. Very good idea to read their FAQ's, etc. to get a better understanding.

Handbrake is good for the newer high definition Blue-Ray videos also.

There's also a related program called MkvMerge. Another is VisualHub.

BTW XviD is not much better than standard MPeg 4. And has not been developed much in a few years. Wikipaedia will show you at what level XviD is at .. still uses an earlier standard of MPeg 4, just above the standard MPeg 4 definition.

Note: just a warning about Handbrake's Picture settings. By default it tends to crop videos. I always set the picture to zero cropping .. so always check your Picture Settings option. And you can choose Anamorphic if it suits the video's purpose. (That's another reason I use my own custom preset encode settings with picture cropping set to zero. Official PAL & NTSC formats require 8 pxls at the sides to fulfill their requirements. And yes I did complain/query about that at their forums lol ... losing out on part of the pic some of them don't realise when they crop the black areas at the sides. Though depends on video of course I guess.)

(The implication of what I suggested is that by cropping the sides .. means that if someone were to burn the video to dvd ... there would need to be re-organising of the pixels throughout each frame during the conversion process .. thus lowering the overall video quality of the end product. eg: possibility of some pixels getting chopped in half .. compromised.)