Since you are using DVDFab HD Decrypter, you are somewhat limited with what you can do with the program.
Basically, you can take a DVD, put it in your DVD drive (which, after Fab opens the disc, becomes your 'source')
You are allowed to write the output to your Hard Drive (no compression), but at least you get to choose which folder to write it to, and that's about it.
(that becomes your 'target')
If you want it compressed to fit on a single layer blank, or change it to an ISO image file, or even write it at all to a blank DVD, you'll need additional software to do these tasks.
Based on what you've written, looks like the program is performing as it should.