No, VideoReDo will simply cut out commercials in the mpeg files you have produced using hdtvtompeg2. It can't make mpegs and it won't reencode your files---just use it to cut out sections you don't want.
As I see it, you'll need to:
1. transfer your files to the computer
2. convert to mpeg2 using hdtvtompeg2
3. cut out commercials using VideoReDo
4. Use an authoring program to put the mpeg files into a dvd compliant format (I like DVDLab Pro but it is fairly expensive compared to some others, such as TMPGenc Author 1.6) If you have Nero, you can use NeroVision Express.
5. burn to disk
When you convert to mpeg2 using hdtvtompeg2, what are the specifications of your video? In other words, what resolution, bitrate, type of audio, etc does it have? Use a utility called Gspot (free download) to get the particulars of that mpeg2 file. The reason I ask is because dvd video is fairly stringent in what you can use and have it play on most dvd players. If you are in the US you'll probably want to use 720 x 480 resolution, 29.97 fps, 48kHz 16 bit pcm or ac3 audio. PAL specifications---used in much of the rest of the world---are quite a bit different.
An authoring program won't (or shouldn't) reencode the mpeg files. They should be compliant going in.
Edit: Didn't really notice that last question you had. When you convert using hdtvtompeg2 it doesn't seem like it is reencoding, at least, not from the information on their site. Looks like it somehow reorders the stream into a mpeg file. But they don't give any details on the output....resolution, fps, etc which is annoying. Run Gspot on one and report back in. Like I said before, I haven't got any experience with this program so I'm working in the dark too.
Of course I'm assuming you're trying to get everything onto dvd's. If you just want them to play in the computer, you just need the mpeg2 files and don't have to worry with dvd specs. They should play in the computer with any number of video players.