Encode your mpegs as dvd, with a low bitrate so the finished mpeg is about 2.1gig. Use mpeg audio (mp2/mpa) and not LCPM.
Tmpgenc will do this, if you take note of the advanced options.
Once you have the mpegs, you need a program to author them to dvd.
That's where you add the menu to choose which movie you want to watch.
My personal fave is DVDLab, but there are many others, some with severly restricted options, and you may not be able to author a dual-movie dvdr with them.