Unfortunately, there are a LOT of decisions involved in this process. I know because I'm going through the exact same process.
A) How do you want to store the videos? You could put one video per DVD and make it playable in a DVD player. Or, you could put several tapes as individual files per DVD disc. This is more efficient for storage, but it means you won't be able to watch the videos on any DVD player.
B) If you go with the file route, then what format do you use to store the data? Each one has their own strengths and weaknesses. You can pick from WMV, MPEG2, or AVI
C) If you use AVI, which codec do you use? Windows Media? XVID? DIVX? 3VIX? etc.
Since it takes a very long time to digitize a video collection, you need to make sure it's done properly.
Personally, I think that I am going to go with having multiple files per disc, stored as AVIs using the XVID codec. Of course, that is always subject to change.