The question to your answer, in simple terms is: You can't.
MPEG video, that which is used for standard video DVDs, is a lossy compression format, just as JPG is for images, MP3 is for audio, etc. Additional conversions to any other format to save space will only further degrade quality, even if it is what some might consider slight, which is the case any time you convert from one lossy format to another. There are lossless video formats, but they will take up enormous amounts of space in comparison to the original video.
Could you convert a 4GB DVD to, say, a 2GB Xvid (.avi) file and retain excellent quality? yes. But you'll be losing data and quality in the process, and if/when you want to burn the DVD as a standard DVD again, you'll have to AGAIN convert it back to MPEG2, which is what DVDs use. And doing so will mean you'll have twice gone through lossy compression conversions to get back to being a compliant DVD. Think of it as saving a JPG image or MP3 file over and over again, each time you do so you'll lower its quality by introducing more artifacts introduced by the compression, as well as getting further and further from the original with each conversion. If you don't mind losing quality in the process, you can use programs such as RatDVD or AVI to DVD, DVD to AVI programs to compress DVDs, you can look on Videohelp.com for lists and links to downloads to such programs.
Simply put, if you want to retain the quality of the original, you'll have to keep it as-is. You could mess around with using file compression such as Zip or Rar, but it will take a very long time to compress that much data and you'll yield probably 2% space savings at best, not worth the trouble.