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Converting a lossy format into another format is not a good idea, because any conversion will cause sound degradation, so making the result worst than the original.
The best option, then, is leaving the sound as mp3.
An alternative is extracting again the sound from the original DVD as AC3, and then remuxing the audio with the video file. In this way you’ll have the same quality of the original disc. This procedure, however, can cause syncing problems, that are really annoying to solve. So the best alternative is encoding again the avi from scratch, a really annoying (and time consuming) work