1) Download Handbrake & VLC, install both
2) Set Handbrake settings as following:
- Container: mp4,
- Video: h264, set quality to 19. Some huge over 10Gb 1080p source materials require 18,5 in order to fit under 4Gb.
- Audio: AAC, quality depends on source. No sense in remuxing anything above 320kbit, and never give audio higher bitrate or more channels than source material has! If source audio is already in AAC format, use passthru.
- Subtitles: burn-in
3) Do not use anything on video filters tab for anything else except DVD rips! Decombing messes burn-in of styled subtitles!
Nice thing with Handbrake is you can use it for batch operations on command line or build encode queue on GUI if preferred. Depending on source material my trusty 5 year old T60 with its Core2Duo does encoding usually at about 25fps with regular 720p anime episode mkv's & DVD ripping. 1080p FLAC source material brings entire system to crawl with about 8fps on average. YMMV.