AVI is a container. It supports many video codecs including MJPEG · MPEG-1/2, MPEG-4 ASP (xvid, divx, ...), MPEG-4 AVC (x264, nero digital,...), MJPEG, RealVideo, VP6, VP7, WMV.

What exactly do you want? Convert MPEG-4 videos to MPEG-2? Create a DVD from MPEG-4 videos? Something else?