You're going to have to use TMPGEnc and convert it to MPEG1 first (since SVCD uses MPEG2, which is unsupported by VirtualDub).
If you know anything about VFAPI streams, you could stream it right into VirtualDub via TMPGEnc... It would save you some time, if not, just encode it into MPEG1, and then open it in VirtualDub, or just leave it in MPEG 1 and play it with PocketTV on your device.
