For whatever reason, I have found that demuxing into the AVCHD file system format has some overhead - maybe 5-8%. It really shouldn't expand, but for some reason it does. This is enough that sometimes it is difficult to get things into a size that will fit on a DVD 5. I don't have a solution for this other than using some other utility to re-write the file with more compression.
I have found that a 4GB M2ts (MPEG 2 Transport Stream) file will turn into an AVCHD with enough room left to be comfortable - a 100% success rate. Using TXMuxer and MKVExtractGUI I have made some disks that work great.
About audio with AVCHD, like a DVD-Video, you can have a PCM track, but there will only be room for that if the video is compressed like mad, so you pretty much need to resign yourself to (a high bit rate) AC3 5.1. Blu-ray has some wonderful audio capabilities, but to get those, you will need the extra space of a Blu-ray. The AVCHD is limited to the two formats.
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