This is my contribution for the day lol
Requirements:
A computer
Any Video Converter
http://www.any-video-converter.com/products/for_video_free/Common Sense
1) Run Any Video Converter
2) Drag the videos you want to convert into the screen
3) On the right side in Profiles, select "Customized MP4 Movie (*.mp4)
4) Under Video Options
Video Codec: x264
Video Size: 480x272
Video Bitrate: 512 or 768 (anything below 512 would look bad, anything above 768 might not play in your Android Phone)
Video Framerate: Auto (or make it the same as the original video you're going to convert)
5) Under Audio Options
Audio Codec: AAC
Audio Bitrate: 96 or 112
Sample Rate: 44100
That's it. After finishing the settings, just press convert and you're good to go.
I've been using these settings for my videos both on my G1 and PSP.
A 700mb video would be around 400mb afterward.
A 400mb video would be around 200mb afterward.
I use Meridian Player to play the videos.
PS: Any Video Converter is Free, but they also have a Pro version. The only difference I can distinguish between the 2 is that the Pro version, there are already set Profiles which makes it easier for the end user.
You wont need another video converter besides this one. Its easy to use and customize.