For 1: go here: *www.doom9.org/
and under guides -> DVD Backup (Full Guides) -> MPEG-4 (DivX / XviD/ NeroDigital / x264).... You can choose whatever desired format you need the destination file to be and then write it on to a CD so that it can be readable with CD/DVD drives, if that is what you meant. Also, there you can download the free software Auto Guardian Knot.
I am sorry, I am only aware of non-freeware defragmenters.