Install the regular version of DVDShrink.
Once you have it installed in the computer, unzip the rar file with the new DVDShrink file. When it is unzipped, you'll see a folder, and inside that folder is the new executable file for Shrink.
You have to either drag this new executable file to the place on the computer where DVDShrink is installed, or copy and paste the new executable file in that DVDShrink folder in your Programs folder. Either dragging and dropping, or copy and paste work for this.
In essence, you want to replace the original DVDShrink executable file with this new one.
Now, when you import a dvd into Shrink, and you have everything set as you want, you click Backup. This brings up a small pop up window where you see several tabs, and it should start on Target Device. On the Backup Target line, set this to ISO Image File and Burn with ImgBurn.
When using Shrink it is advisable to also adjust the Quality settings. Click on the tab for Quality Settings, then put a check mark in the box to do a Deep Analysis and put a check mark in the other box to do adaptive error compensation. I normally leave the latter setting on Sharp.
Click OK to start the compression. You'll need a blank dvd in your burner for ImgBurn to work with. I also recommend setting the burn speed manually before beginning anything in Shrink. Just open ImgBurn and set the speed to 8x (or 12x if you are using a desktop burner and good quality blank dvds). Once you have the speed set in ImgBurn, it will remember this speed and try to use it if it is possible, so no need to do it more than once.