Why must PSP video conversion be so painful?

[PlayWithFire]

I can't get anything to work.
I have a TV show that's in a widescreen format, and all i want is to be able to convert it to 480x272 video to take full advantage of the screen.

The closest thing that worked for me was xvid4psp, but that didn't sync up the sound with the video. I spent about 2 hours playing with VLC command line transcoding, and it doesn't work. I do have a video that's in my target format, so if someone could tell me the command line to get my videos into that format, it would help me greatly.
Here's the video that works http://pspvc.nswardh.com/pspvc.php Look for hellboy trailer on the right side of that page.
And here's a screenshot of GSpot on my input video http://i25.tinypic.com/jkvcyw.png
Can you tell me how to use VLC to get my videos into that exact format?

I would appreciate any help, i am trying to convert some TV shows for my girlfriend who's going on a very long flight.