Its quite possible that TPEGEnc Plus can give you better results, it is an Encoder as opposed to a Transcoder (NeroVision Express). I think it also depends on the quality of your VCD as well.
How about you try both ways and see which you find is easier and what produces better results.
On a slightly different tack, why do people prefer DIVX, XVID to Nero Digital MP4???
I’ve converted a movie to a 700 MB MP4 which is simply running it through Recode and converted it back again to DVD 3-4 GB using NeroVision Express and to be quite honest , the video was wonderful and it still had the Dolby 5.1 track and the sound was amazing. I’ve never had this sort of result converting any DIVX, XVID file.