Best way to get Wake DVDs on iPod

O.K., I got a 4 Gig Nano, and I just got a 60 Gig iPod Video, I am stoked! But, I need some help figuring out how to use these things.

I have done several searches and I know there is tons of software out there that takes a DVD and puts it into Apple iPod Format (MPEG-4). However, I am leary of freeware, as I don't want my computer getting all screwed up from junk software.

So, here's my questions:

1. What is the best software to use to convert DVDs to Video iPod?

2. Can you make chapters in the iPod converted movie so that you can advance to different scenes without fast-forwarding?

3. What if I want just the songs from a DVD put on my iPod Nano, how do you do that?

Thanks for the help, I can't wait to figure this out!