It will be just a standard NTSC DVD.

I want ot make sure the sound is as rich as possible and give stereo / 5.1 options.

Not so much for fx panning but to utilze a system if they have one.

You can take a 5.1 originated project and easily collapse it down to 2.0 after rendering the first file as 5.1. Just reopen the same project, put the properties to stereo, rename/save as, and then adjust the mix accordingly. If you've mixed the 5.1 correctly, any DVD player should be able to collapse it correctly to stereo these days anyway.
Bear in mind, starting with MP3, you are not starting with high quality audio to begin with, and therefore aren't going to get an accurate picture of quality in your experiments.

Well, that's the format in which they came, mp3.

I've not done a lot of audio work, so I'm not certain if there is a way to improve on that (e.g., getting back toward wav quality).

I'll have to look for the best way to represent the mp3 as it was given to me.

What do you normally use to monitor during mixing?

I've tried my 5.1 system around my station, but i've been fooling with some active noise cancelling headsets that really let me hear more frequency ranges.

??

Headphones are not good for monitoring. Especially noise cancelling ones.
Your project will be a DVD and most people listen to DVDs through whatever speaker system they have hooked up to their TV.

Good headphones almost always allow you to hear in greater detail, but it's a false picture of how the mix will sound over speakers. Headphones are designed to sound good an each from your ears, speakers are not. Some of the new way-in-your-ear buds are designed to specifically resonate with the bones in your ears to produce fantastic sound.

What you want to mix with is a set of audio-monitors. Monitors, unlike plain speakers, are designed to let you her your mix accurately. Home speakers or surround system are designed to make your audio sound good. That is they have little tweaks designed to cover up flaws, say, to tame down screechy high frequencies. Audio monitors are designed to sound accurate/neutral. Since you can know what your project will eventually been played on, the purpose of the mix is to get as good a sound as you can at the source. The way to accurately hear this is through audio monitors, not 5.1 computer speakers.

The cheapest set of 5.1 audio monitors are these, I believe. They're $420 at B&H. Guys who do profession 5.1 mixes can spend thousands on their monitors.