You should't need any codec packs for DVD Fab to encode as Fab installs necessary codecs.
On the other hand, the mobile device must have the correct codec packs installed to play the files and on some devices this is not possible.
On the bitrate issue, trial and error is your best teacher.
My Dopod mobile phone (PDA) can sustain a bitrate of around 300Kbps but when I drop it back to 150KBps, there is no discernable loss in quality but the file is around half the size.
We need more detail on how and on what device you are trying to play these files before we can be of more assistance.