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What is my time limit? I can't seem to find that answer anywhere.

The time limit in any video format is based on the Total Video_Bit_Rate & the Audio_Bit_Rate.
There are many bit-rate calculators you can use to perform the calculations.

You can use this formula as a fairly close calculation:
(BitRate in kilobytes * 60) / 8 = KiloBytes per minute.
Playing time for a single sided dvd (4.3 gigs or 4300 megabytes) is
(Size_Of_DVD / MegaBytes_Per_Minute) = Approx playing time.
I use 4200 for the size of a single sided dvd to leave some safe space on the dvd and for menus.
So using your above calculation of 9000 VBR (Variable Bit Rate)
(9000 * 60) / 8 = 62.500 MegaBytes
(4200 / 62.5) = 62 Minutes

That's using Variable Bit Rate in the ulead encoder.
Constant bit Rate is a different calculation (you must add the audio to the video bit rate)
Using the Ulead Encoder if you used 8000kbs at CBR with lpcm audio then the total bit rate would be:
8000 + 1536 = 9536 kbs. Then ((9536*60) / 8 ) = 71.520 MegaBytes Per Minute.
(4200 / 71.520) = 59 Minutes (Note: Dvd's are actually 4.370 Gigs)

It's easier to perform calculations based on Constant Bit Rate.
A Bit-Rate Calculator does all these calculations for you.
Perform a search in the VS forum and you will find some links, there should be a link to a Bit-Rate Calculator in the tutorial section.

I tested AVCHD videos using SmartProxy for editing and it does run smoothly. I setup my project settings are requested, however, I cannot manage to get 1080x1080, the highest size is DVD 720x480. I created a HDMPG video and the size came 720x480.

Sorry, but what exactly are you trying to do? Burn an AVCHD hybrid disc using AVCHD files (Share > Create Disc > AVCHD) or are you using standard DVD commands (Share > Create Disc > DVD)? Can you also clarify that your reference to 1080 x 1080 is a typo for (I assume) 1920 x 1080)? Give us a few more details of your workflow.

Sorry Ken.... I am trying to develop the workflow to edit AVCHD video. I tested SmartProxy and it seems to allow me to work on such files and retain Dolby Digital. My final product will be both a Blue-Ray disc, and a regular DVD for those with no BR. Very important to retain Dolby Digital on both final products.

The following advice was provided by etech some time ago, and it should work to solve both your intended uses of your video:

I first convert my avchd videos to standard definition mpeg2 dvd compliant videos.

I then use those dvd compliant videos for editing.

Making sure the "Re-Link" feature is turned on after I save the project I then either move the original mpeg2 dvd compliant videos or replace them with the original avchd vidoes.

After you're done editing the standard mpeg2 and save the project then rename their folder so when you reload the project VS asks you to relink the videos. That's where you then select the original avchd videos. This is my own method using the dvd compliant videos as proxy files (plus I have them to make a standard dvd).

When I render the file or burn an avchd disk I turn off smartrender and the avchd vidoes look fine. I prefer using this proxy method compared to VS method of working with proxy files. Plus I also have them all in DVD compliant format.

Ken, how do I set the project settings to 1920 x 1080? The highest resolution is 720x480. Thanks.