Here are the specifications for iPad video:
* H.264 video up to 720p, 30 frames per second, Main Profile level 3.1 with AAC-LC audio up to 160 Kbps, 48kHz, stereo audio in .m4v, .mp4, and .mov file formats;
* MPEG-4 video, up to 2.5 Mbps, 640 by 480 pixels, 30 frames per second, Simple Profile with AAC-LC audio up to 160 Kbps, 48kHz, stereo audio in .m4v, .mp4, and .mov file formats;
Handbrake has a preset for the iPad, so it should be an easy program to use for this conversion. Handbrake's default settings for iPad are as follows: Mp4 file format, H264 video codec, AAC 160 bitrate, approximately 848 x 352 display size from a widescreen NTSC dvd I looked at (odd that it upscales the width). Display size will vary slightly depending on the movie apparently.
Handbrake automatically cuts the black bars top and bottom, though you can change this behavior if you wish.
Xvid4PSP probably also has a preset for iPad. Been too long since I've looked at it.