I don't even bother compressing anymore.... straight to ISO for me. I have daemon tools set to automount the DVD/Bluray/HDDVD and then WinDVD9 plus set to auto load.
There are two aproaches. You could either retain the entire disk including all of its features or just include the main feature in the ISO. With the latter, it really works no different than any other AV file except that you can keep multiple soundtracks.
DVDs average about 8gb sooo you can fit about 100-125 per 1TB HDD. With storage the way it is, it doesn't make sense to compress.
When I built my first server, I planned to put EVERYTHING on the server. With this new server that I have, I am only ripping my top 150-200. I have about 300-500 movies depending on whether you include TV on disk or not.
Here is the deal. The majority of folks do not need their whole collection on the server. Why? If you watch 3 movies per week, that would be about 150. Figure there will be some weeks will you can't fit in 1 if you are lucky and others where it is a movie fest. Then factor in that you are going to watch atleast 4 "new" movies per month. So lets do the match. (52*3)-(12*4)=108. So that would be a little over 100 archived viewings. Now lets factor in how long you go between watching shows. I personally end up watching shows like LOTRs, the Matrix, Superman, Princess Bride about once a year. Some like Alien, maybe once every 2 years. So lets say it comes to you watching 70% of those once per year. So 108/.7=154. That is how I came up with my list. I figure that if I am not going to watch a show atleast every 18 months, it just really isn't worth putting it on the server. In the time it takes me load the disk, rip the ISO and set it up in the PC, I could have inserted and put away the disk after watching it like 3-4 times minimum.
Putting EVERY disk of yours on a server is a waste of time and money for most people.
Of course, this is assuming you do it the semi-legal way which is to actually own the disk.... not being a ripping netflix DVD's addict. I have a "friend" who once ripped disks, but he realized he ripped some which he wouldn't really have wanted to watch again and basically could have spent just as much money owning the movies he decided he really wanted in the end.
Back to the ISO thing. You will always get some degree of degradation when you compress or re-encode. You may not notice it now, but down the road you will. I have number divx files that I once thought were fine when viewed on my 27" CRT that now look like bantha droppings on my HD projector.
Same with MP3s to an extent. In retrospect, there are many songs that I wish I had compressed in 192+ than 128 to save space. Now the space for them is irrelevant for the most part.