Those all in one DVD to VCD SVCD Programs are never better than useing the Right tools and doing it Manually..I think your Problem lies in that DVD2SVCD uses AVISynth to frame serve the D2V files to Tmpgenc and i have had the exact same Problem as you are with AVISynth and D2V Project files, I would sugest not useing DVD2SVCD for this time and try doing all the steps by your self but not useing AVISynth as all you need is Smartripper, DVD2AVI and Tmpgenc to Make a VCD/SVCD out of a DVD, and there are Lots of Guides on this Method at
http://www.dvdrhelp.com/