Yeah, any of the supplied templates should be OK.
If you are feeding Workshop an MPEG file, you will need to go to the Video Edit window and check the box that says
Convert to disc template. Otherwise, the MPEG won't get re-coded.
In general, you should NOT re-code your MPEGs, because MPEG is lossy, and you loose some quality each time you encode. (In some cases you don't have a choice.)
HIGHER BITRATE = HIGHER QUALITY. The DVD spec allows bitrates up to about 10,000kbps, But, some DVD players have trouble with "burned" discs above 8,000, so that's a better rule-of-thumb maximum.
DigitalFAQ.com has a chart with the DVD specs.
And, here's a handy
Bitrate Calculator.