MPEG-VCR will edit vob files directly. All you have to do is open your "MPEG file or movie" from the file tab, go to where you want to make your edit, at the start of the edit click the "Mark In" button and insert a marker, at the end of the edit click the "Mark Out" button and insert a second marker. Once you're happy with where those are then select "Cut" then "Save". Of course none of these buttons are labelled, but they do have tooltips, so you'll get used to it pretty quick.

Tip of the day: It's useful to find the exact point with the frame by frame "step" buttons.