I do this a lot for home movie transfers.
I go directly from a camera live to the DVD-Recorder though
and skip the tape step. If music is to be added, I record
to DVD-RAM then rip/demux the .m2v video streams.
I bring those into ReelDVD then drop the music right
over it. I made a DVD-ROM full of licensed music with
both pcm .wav files and dolby .ac3 files. I always use
the .ac3 files to keep compatability and playback to
a maximum. Then I build the disc from ReelDVD and burn it. Done.
simply adding audio streams to an mpeg2 video only stream should
not require any re-encoding. I wonder if there is an option somewhere
in ulead to turn it off.