This is touch task for the technology designers to maintain High Quality Video result with small sizes. Hence High Quality comes with Large Sizes.
But some formats have been provided to maintain high quality videos in small sizes. In the technique i am explaining you can reduce avi file sizes while maintaining the same quality.
I have used this technique to reduce size of fraps records movies.
Fraps movies consume 9.5Mb/sec (1024×768) 1 min movie 570 MB
With Xvid codec Compression 357KB/sec (1024×768) 1 min movie 21 MB
The K-lite Mega Codec Pack installs the Xvid MPEG-4 Codec. Which Will be used in this technique
Run Virtualdub and drag your avi file to this window. In Video tab select Compression. In the new box select Xvid MPEG-4 Codec and OK.
Now in the File Menu select Save As and click Save in the new window.
The dub will start. If you want the dub to process the file faster you could uncheck the Show Input Video and Show Output Video.
The Virtualdub supports batch file processing so you can queue a bundle of files and compress them. If something is wrong or missing, let me know