I'm not sure for windows, but MPEG Streamclip is great video converter for mac.
If your looking to convert dvd media to play on your psp, I recommend Handbrake (cross platform). If you want fast encodes for your psp, just use the preset that comes with Handbrake. If you want better quality (and a smaller file size), chose the psp preset, change the codec to H.264/AAC, change the video size to a max with of 480px (change the heigh to 272px if it's a 4:3 movie), click on "Advanced", then replace the code in the text-box with this:
crf=18:ref=2:mixed-refs=1:bframes=3:b-rdo=1:bime=1:weightb=1:subme=7:trellis=2:analyse=all:level=3:merange=64:no-fast-pskip:me=umh:sar=1/1
I also (when encoding for the psp) use two passes, and drop the average bit rate to between 400 and 550 kbps.
Edit: video of setting it up can be found here:
http://screencast.com/t/rlQ1mLTIb (sorry about the large size, the program i used to make it is free, but it prevents post editing)