You can comfortably and easily get a 2 hour program onto a standard 4.7 GB SD DVD.
Try an encoding rate around 6 Mb/s, that should be a decent trade-off between quality and space limitations.
Of course, you could simply allow Encore to use its automatic data rate settings, which will probably squeeze just a little more quality out of your video by raising the bitrate a little more.
Keep in mind, the higher the data rate, the smoother and less pixelated your content will look, but your file size will also increase.
My personal preference is to try to get as close to 7 Mb/s as possible, depending on the overall duration of the content on the DVD. I never go over 8 Mb/s, as I have discovered that not all DVD players are able to accurately play back the DVD's without stuttering or video freeze issues.