Best video converting hardware/software for VHS-DVD?

in Genius Bar edited January 2014

I am having problems finding some much needed details on what the best software/hardware is for converting video formats on a Mac. I should note I am using a new iMac 4GB memory and Leopard OS so what I use needs to be compatible. Here's is what I need to do:

1. Transfer old VHS tapes (home movies and such) to DVD. I need to be able to use DL DVD discs for my recordings so I don't have to switch DVDs. In other words make them just like the DVDs you play that you buy. Therefore, they also must be able to playback in home theater DVD players, not just on the computer. I would assume the best way as for encoding is to get the VHS tape in digital format on the hard drive, then use the codecs to turn them into DVDs?

2. Once on the hard drive I also need to convert them to a format neutral playback on both the Mac and PC. What is the best, MPEG 4?

3. The ability to do some nice editing of making bookmarks, chapters and thumbnails for the DVD menu and divisions I wish to make. In other words, if I have a home movie containing my Summer and Winter vacation, I want to insert bookmarks at points to skip to like in a movie DVD and also have a thumbnail of it just like DVD movies does.

4. A nice MAIN menu for the DVD that will let me hit the main categories, not just chapters for the TOP level DVD menu. Such as Summer Vacation, Winter vacation.

5. The software should be easy to use so I don't have to take a HUGE crash course requiring lots of work making the project a chore. Also, I don't want or need a professional package, just something simple that is less than $200 per software program. Not the expensive $500+ options for movie makers.

Thank you for any tips and advice on this matter.
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