I use 2 DVD authoring programs that both recognise AC3 audio. Tmpgenc DVD Author & DVDLab. I use that latter exclusively now as it's much more flexible.
If you're only starting with a non-AC3 audio source then asid's suggestion sounds (pun) fine to me. However, if your video source has AC3 audio it seems rather a shame to lose it. I extract it with virtualdub & then use that in DVDlab to author the final DVD.