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Update (2008-12-23): I have discovered an alternative to the method below, which works equally well (although not as fast as the DVD is ripped and re-encoded) - details are posted here.

Wow - it has taken me nearly 8 weeks to figure it out and the solution is so simple. The vast world-wide web seem to have no appropriate solution for (legally) ripping a DVD to a movie-file, so that it can be conveniently stored on a multimedia-server without having to hunt down the DVD itself (or having to get up between movies - )

I was looking for an easy, automated way to rip a DVD with it's surround-soundtrack and then stream it to the PS3 via the UPNP server. Yes there are tutorials out there to rip video and audio separately, then mux and demux and re-encode the whole thing into a specific video container. Problem is that once the codec changes or a new device comes out (such as the ATV) your tuned, 6-lines of encoding-optimisations parameters (which not even a rocket-scientist understands) are useless.

The screenshot below shows Transformers being streamed over a AEX-WAN onto the PS3 (notice the 5.1ch?):

The above was straight-forward: vobcopy -l. The latest version of vobcopy will rip the title with the most chapters as a VOB and the PS3 is more than capable of streaming it without jitter or drop in quality. (Transformers will rip to 7.5GB for the whole movie)

Alternatives? I have not been able to find a way to rip and re-encode a DVD via the command-line, retaining surround-sound and good video quality. Handbrake was not up to the challenge and many other options are just involving too many manual steps. So if you have a surefire way of reducing file-size and achieving 5.1 surround sound let me know.