I have some home movies that I have transferred to DVD using a standalone DVD recorder (Panasonic DVR7000) to DVD-R. I could go all the way back to my original tapes, but I did some editing on the way in to the Panasonic, and I don't want to start over. So, what I'd now like to do is pull the video off the DVD to my computer, edit and chapter-mark in VV4 it, and burn it to a new DVD with DVD Architect.

What I've tried so far:

I've tried tools that will extract and demux the VOB, but that leaves
me with an M2V and AC3 file which I can't use in Vegas Video 4.

I then tried using ULEAD MovieFactory to extract the video, which
turns it into an MPG file. These files play fine in Windows Media
Player. When I pull them into Vegas Video 4, however, it comes in
only as video, and there is no audio track. VV4 appears to be
ignoring the audio. I suspect this is because the embedded audio is
still AC-3. Although I must admit that this confuses me because I was
under the impression that VV4 handled AC3 audio streams.

I'm just missing some piece of this puzzle that will allow me to pull
the extracted video into VV4 and have both the audio and video tracks.
Once I have that it will be smooth sailing for the rest of it.

Anyone have any guidance on how I can get this done?