Ok guys, good news and bad news. Bad news is that the lossless AVI didn't even render 100% as a chunk of it came out blank due to the hard drive disconnecting during the render. So it looks like I'll have to render straight to MPEG-II using Vegas.
The good news is rendering to MPEG-II with Sony Vegas is a piece of cake.
The thing that might piss off some people but something that most won't even notice: So the reason I was going with the original method was that going from 23.976fps to 29fps through pulldown fades your frame (to put it simply) whereas a complete conversion to 29fps will duplicate frames. The good news is that the human eye won't be able to tell the difference between the two unless you watched a bunch of DVD's with pulldown right before the edit. You might realize something is a little off for a few seconds but the human eye will readjust (which is why we have no problem with low framerates regardless of the fact that the human eye can differentiate frame rates until up to 100fps.) So in the first few sequence you MIGHT notice it slightly if you were watching a few DVDs before, but after the opening logos you should be comfortable (unless you're Clark Kent).
So this is the decision I'm going with. I asked the community for help as much as I could and I took whatever I could, but at this point I can't do anything beyond buying a new power supply, which I'm no longer considering doing as the difference between 5 faded frames and 5 duplicated frames is so slim. Also, I don't want to buy more hardware for my computer as I'm buying another one soon so it would be pretty pointless.
Just a send off, go watch AOTC, that has a direct conversion of 23.976 to 29 frame rate, not 23.976 with pulldown (on the NTSC DVD). I caught this while editing it. (The only difference between AOTC's dupplicated frames and this is that sometimes the AOTC frames are in random places (like a quick shot of Yoda during the chase scene, etc (yes I went through and patched up what I could))
So rest assured, not much left. I need to render the MPEG and then I will render one final WMV as a stand alone file (23.976 fps) to be released online for people to convert to their mp3 players, xboxs, ps3s etc.