"I have Vegas, but the problem I run into there is that Vegas doesn't recognize the .M2V or .AC3 file extensions that DVD Decrypter gave me for my video files and audio file. Do I have to further convert the video files for use on Vegas? Is there some kind of plug-in? Any help would be appreciated."

I just wanted to point out that, if you have the MPEG plugin, you can import the VOB and edit the video (though you will still have to recompile to an entirely new MPEG) Extract the audio and convert it to .wav (I use Sound Forge to pull it straight from the VOB), sync up to the video, and you're good.