I don't know that there's been a court decision covering that specific case, so it might still be in a legal gray area. To me the decision in the Betamax case

I don't know that there's been a court decision covering that specific case, so it might still be in a legal gray area. To me the decision in the Betamax case suggests that it would be legal. Others say the precedent doesn't apply because the Betamax case was looking at time-shifting, and space-shifting is different. However, in any case avi to mpeg4 is not equivalent to DVD ripping from a legal standpoint. Because of the DMCA, US law makes a distinction between media that is encrypted for copyright protection purposes and media that is not encrypted. So since DVDs are CSS encrypted and AVIs aren't, the two are covered by somewhat different sets of law.