It is generally not a good idea to try to fit two full length movies onto a single layer dvd…not in dvd-video format. The compression necessary will degrade the quality of the movie more than most people would like.
But it really depends on the running time of the two movies. If they don’t exceed 2 1/2 hours combined, then you should be ok.
You could also burn two movies to a double layer dvd and keep good quality. Most people don’t like the extra expense of the DL media though, and there is only one reliable brand, Verbatim.
If you’d like to try putting two movies onto a disk, use DVDFlick or AVStoDVD. Both can import dvd video and compress them to fit your target disk.
It is usually better to convert to a format that is better suited for high compression, like xvid, divx or h264. You shouldn’t have problems fitting two full length movies using these formats, but you would have to have a dvd player capable of using them. I don’t think there are any dvd players that can use h264, though I might be mistaken. To go to xvid, use Handbrake or AutoGK. Burn as a straight data disk, and let the player show you the selection of videos on the disk, rather than having a menu.