Make sure to read the manual of every utility you use.
A TV recording is usually interlaced rather than telecined. This is interlaced.
To rip DVDs I recommend mplayer, it's clunky to use and has its limitations, which are not at all helped by how bad of a format DVD is, but it gets the job done. If you do it well the only thing missing will be the chapters, I don't know of a FLOSS tool that can rip DVD chapters.
mplayer is a video player with a ripping feature, you can tell it to dump a DVD's title. DVDs have what are called angles, titles and chapters.
Usually every title is either a whole episode (or the whole movie if it's a movie) or a copyright notice, an ad, or the menu video. Usually.
This is the exact command line I used to rip a test DVD just now:
>mplayer -dumpfile ~/test.vob -sid 0 -dumpstream dvd://2 -dvd-device /mnt/
Every one of those options is in mplayer's manual. One detail that you will see from the "dvd://2" part is that I ripped the 2nd title, because the 1st title was actually the DVD menu. In this case it's a very well done DVD for a multiple episode anime called Maps, and in this DVD every episode is a title. mplayer won't rip subtitles by default, you have to specify a subtitle id with -sid.
Often, including in this DVD, titles are split into multiple files within the DVD. mplayer will sort it out for you and output a single .vob file. This single .vob file is easier to manipulate with ffmpeg, you can also use the ffmpeg concat filter to get the same result, but then ffmpeg alone doesnt automate nearly as much of the job.
The .iso file was mounted on the /mnt/ directory. Inside /mnt/ is the VIDEO_TS directory, i.e /mnt/VIDEO_TS.
After that, it seems ffmpeg can read the concatenated file properly.
The result is a .vob file which is ready to be manipulated with ffmpeg to do whatever you need to do with it.
I'm just going to pretend that my example file is your example file for a second, you can turn any format into any other format very easily with ffmpeg. It's one of the simplest ffmpeg use cases.
>ffmpeg -i test.vob -c:a copy -c:v copy video.mpeg
Now comes the part where the DVD is finished.
>ffmpeg -i video.mpeg -vf yadif,scale=720:540 -c:v libx264 -preset:v slow -b:v 2000k -c:a copy -map 0:v -map 0:a video.mkv
Here's the output file, video.mpeg was the file you linked, video.mkv is the result from that command line: https://x0.at/dG5.mkv
All of those options are also on ffmpeg's manual.
After ripping the DVD you can either undo the interlacing or tag the file appropriately (your mpeg file is already tagged perfectly, I checked it) and leave the deinterlacing to the video player. All the video codecs currently in use lose efficiency when fed interlaced footage, so if you will reencode you should take the chance to also deinterlace.
The video already doesn't look good, I'd just mux it as is into a mkv file. The example reencodes.
The algorithm used for fixing deinterlacing matters, better ones give better quality. ffmpeg supports a good one called NNEDI. Because of some licensing nonsense the manual tells you to download a file the algorithm needs to work from github, if you can't do that use yadif. Everything is in ffmpeg's manual.
Generally, you shouldn't touch DVD audio. DVD uses a lossy audio codec called AC3, there's no point in reencoding it to a lossless codec because it'll increase the filesize, and it's very undesirable to encode it to another lossy format because there'll be a huge quality reduction. Lossy audio codecs in general use tricks to make your brain not notice the quality loss, whereas video codecs hide detail your eyes don't pay attention to. Lossily encoding already lossy audio breaks the illusion and there's a lot of added loss, while on the other hand you can take a jpeg screenshot of some video and have trouble telling apart your lossy screenshot from the lossy material it was taken from.
Another thing you can do is scale the video to make the pixels square, bad (software and hardware) video players which can't handle rectangular pixels are everywhere. Rectangular pixels also cause trouble with the video codecs and reduce efficiency, so it's generally a good idea to get rid of them when reencoding.
A NTSC DVD's resolution is 720x480 and the aspect ratio is 4:3. If you scale it to a 4:3 resolution its rectangular pixels will be stretched to squares. Don't downscale the video to 640:480, upscale it to 720:540. By downscaling, you're discarding detail. By upscaling, you're extrapolating detail. The slight upscale is closer to the original than the slight downscale. 720:540 also happens to be exactly a quarter of 1080p, most upscaler algorithms perform better and discard less data when scaling integer multiples, and 1080p and 4k seem to be the more popular screen resolutions these days. The ideal would be to leave the original resolution intact and let the player upscale the original rectangular pixels to your screen's resolution at the proper aspect ratio, but to avoid trouble it's best to take that 720:540 step.
And finally, yet another common quirk among video players is being unable to play streams where the audio comes before the video. In fact, most imageboards won't even allow you to upload such a file. In your file, the audio happens to come before the video. The "-map" options I used fix that.