well, Frank K. is The man.
my thoughts:
these days space isn't such an issue any more, even not for video.
You can compress mpeg2 video a little bit more, and fit a lot on DVD+-R/Video.
As audio stream you can use the original ac3, if your purpose is an backup.
But:
ac3 isn't that perfect, dts would be.
So, what we need since some loner time:
multichannel "mpc", as SV7, 7.5 or 8,
the end-user won't care as long as it runs smooth.
For self-made video maaybe HQ stereo is needed, too,
so matroska with mpc is needed !
Of course, the end-users won't care much about the name, mpc, ac3, or aac.
So, in fact, it would be fine, if Frank K. (together with others) could either make an improved AAC (or ac3 if possible, but imo, ac3 has a very weak sound, so I dunno, if good sound is possible at all with ac3).
A final mpc SV7, 7.5 or SV8 would be nice, too.
I think, the psy-model does not need more tweaking at this time.
You would have to invest really a lot time for tweaking and testing, abxing,
but results, improvements would be minor at this stage, MPC has already reached (see the 128k test at the bottom line...)
So, the work should concentrate on that, what Citay told, including --xlevel eg.
And the possibility to include this stereo mpc into video container.
Maybe this 2 topics should be differentiated.
As it seems, that including SV7 into video properly is a little bit difficult, it might be the good idea to make SV7 final, like others proposed here.
And simply make a proper SV8 stream definition, for video, maybe multichannle, too ?, using the excellent psy-model of current SV7.
well, imo, a bitratesaving multichannel codec needs a lot tweaking to the perfection, mpc stereo has currently.
But imo, the optimizing for multichannle can be done later, if the "container" SV8 would work in general.
well, as Christian told, Frank K. has already sent a detailed ToDo List, nobody knows better, what to do, than him !