Dvd source creator doesnt have support for ac3 audio.
You can:
Demux the audio with VirtualDubMod, convert it to wave or mp3 with fex. besweet.
Remux the audio and video with VirtualDubMod(make sure you disable the original ac3 stream)
Then encode to dvd
Have a look at TheFilmMachine? saves you work and lets you keep the original audio.
