Well the above posting of yours is probably the single densest paragraph I have ever read on cdf. As far as I can tell, you are dealing with at least four separate issues. Too Complex! I have no idea how to help you with all these issues. Have you considered just buying the Battlestar Galactica series on DVD? Way easier solution.
Several things I did pick up on:
You are correct that time of a show has not as much bearing as data size. But DVD media does not hold 4.7GB of data either. It holds 4.33 GB of data.
There is no practical consumer-priced software solution for converting PAL to NTSC standard. They have different frame rates during playback and you will get jittery playback as well as other problems not the least of which is the amount of processing power necessary and the very long time to convert. Conversion is a very bad "solution". Instead just buy a player that plays both formats. Or plays PAL, NTSC and .avi formats. Problem solved(!) with a little money instead of such sweat and frustration!
Also, I believe the Avi format is far more compressed than dvd format and when converted to dvd will take up more data space.