If you have a CD burner it should have come with software for buring VCDs. I think Nero is the best and Roxio is 2nd. TMPGenc is a great program for converting video to MPEG 1(VCD format). http://www.tmpgenc.net/
If you are having problems playing movies and you have the DiVx codec try the Nimo pack. It's a bunch of odd codecs bundled together. http://www.btinternet.com/~nimosiro/