No iApp that I'm aware of has the capacity to burn/create VCD's. The way that I make VCDs is via Toast 6's "Video" option - I simply drag a video file (of any format that QuickTime supports), and click burn. Toast will then convert the video, set up the VCD appropriately and burn it for you. This is probably the easiest way, but if you don't fancy springing for Toast, try some of these.
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