Windows Movie Maker that comes included with XP will convert your file to .avi format, but you will need to capture it from the DVD first. You'll need capture software.

For capture, I use the app that came with my Roxio Easy Media Creator bundle but if you Google video capture freeware or free software you will find some download to try. They usually capture the DVD video as an .MPG which can then be converted to .AVI easily.

What is the final destination of the converted file, i.e. what did you want to use it for? Maybe AVI isn't the proper format, if you mean it for web use.