First make sure that the required codecs are on your computer. For the mpeg4, it comes with Vegas 7 (what I’m using). For Divx or Xvid or any other codec, be sure to get them from their respective websites.
mpeg4 – In Vegas, choose “Render As” -> “Save Type As” -> “Main Concept AVC/AAC (.mpeg4) -> and then choose your own settings in “Configure” or use an existing ipod template.
Divx, Xvid, etc . . . In Vegas. choose “Render As” -> “Video for Windows (.avi)” -> Choose a template and then go into the “Custom” menu -> click on “Video” tab -> click on “Video Format” and you will see the available codecs. Once you choose one, you can further configure it according to the options that it came with.