This is fairly simple and can be done with freeware. First get IsoBuster, you don't need the full feature (payware) version. Here:
http://www.smart-projects.net/cdrecovery.php
Insert the VCD, navigate to it, locate the folder with the red ISO logo, then hit the MPEGAV sub-folder. Right-click the DAT file and select "Extract but filter only M2F2 MPEG frames. Select a new file name and where you want to save it. Okay. Repeat for any other MPEGs you want to extract (if present).
VCDGear can do the job too:
http://www.vcdgear.com/download.html
From here you can go a couple of ways. VCD is DVD-compliant, meaning the video resolution is in the DVD spec. The audio, however, must be resampled to 48 kHz. You can either re-encode with something like DivXtoDVD, or resample with SVCD2DVD.
DivXtoDVD is the old freeware version of ConvertXtoDVD. It will produce DVD-video files properly authored but with no menu. Simply burn the files as DVD-Video and your set-top player will accept the disc. Look partway down the page for it here:
http://www.videohelp.com/tools?tool=vso_DivXtoDVD
You can add more than one MPEG1 to the convert list, and it will put them all on the same DVD.
That's the quick and dirty way, but it upconverts which will yield a quality increase of exactly zero, while (theoretically) quadrupling the bitrate required. And therefore lessen the possible runtime to somewhat over 2 hours with no perceptible quality loss. A better way is to demux the audio/video stream, resample the audio and author the elementary streams to DVD. To do it with freeware means several tools and a learning curve. If you want to go that way, have a look at some guides at videohelp. Or use SVCD2DVD (not free), which can do it for you with a couple of clicks. You can get about 7 hours or so of VCD rez runtime this way without degradation. Your choice:
http://www.svcd2dvd.com/Help/GettingStarted1.5.aspx
Good luck.
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