This is probably all speculation from me.
Burning a divx file onto a DVD, the divx decoder on the player probably does the resizing to your TV.
Burning a divx file into a DVD, the software does the resizing to DVD specs.
Without any side by side comparison, I would trust the hardware decoder in the DVD player first. Since it is designed to work with divx and resize for the tv. If ConvertXtoDVD adds a second pass, then who knows.
Try it both ways and figure out what works best for you. If you are only working with divx, then just burning straight to a DVD without converting will save you time.