If your VCD's are on a CD-R, go ahead and stick the VCD in and browse the contents for the "MPEGAV" folder. When you double click that folder, you should see a .DAT file inside. Go ahead and "Copy and Paste" that .DAT file to somewhere on your hard drive. Make sure you "Rename" the file to "video1.dat". Do the same thing for the second .DAT file if your VCD was split over 2 CD-R's. Remember to rename it to "video2.dat". (Screen Shot Below)
Start up TMPGEnc and from the "File" menu select "MPEG Tools...". (Screen Shot Below)
Now click the last tab, which is the "Merge & Cut" tab and in the "Type:" box, click the drown down arrow and change it to "MPEG-1 Video-CD". Now click the "Add" button and add both of your .DAT files that you copied to your hard drive. (Screen Shot Below)
Note: If your VCD's have an "Insert CD 2" picture you can double click on the file in this dialog and set the end point just before the dialog comes up.
At the bottom of the "MPEG Tools" window, on the left there will be a box for you to specify what name you want and where you would like TMPGEnc to save the file it makes. (Click the "Browse" button to choose a place on your hard drive) Now click "Run" after you choose the "Output" destination. (Screen Shot Below)
Now it will start outputting the file to your hard drive. (Screen Shot Below)
Now we need to split the audio from the video so click the "Simple De-multiplex" tab. Load the file we created in the step before and select a video and audio output by clinking the "Browse" button and choosing a place on your hard drive or use the one it provides for you (just make sure you remember where they are). Now click the "Run" button.
After clicking "Run", it will now start to "Split" the "Audio & Video". (Screen Shot Below)
After that we'll need to convert the audio from 44,100KHz to 48,000KHz which is the valid value for a DVD. If you have a VCD with 48,000KHz you don't need to follow this step (GSpot is a good utility to tell you this). Load BeSweet GUI. Make sure the BeSweet.exe is where the GUI points and then load the .mp2 file we created in the step before (Red). Now click the SSRC tab and put the settings as I show in the picture below (Green Box). Click BeSweet to come back to this screen (Blue Box). Check these two value (Gold Box) and select MP2 as the output format (Pink Box). Finally click Mp2 To Mp2 (Lime Green Button) to start the process.