You never want to re-compress a lossy codec. The net result is always increased file size, longer encoding time, increased noise, and severely decreased quality. Encoding is always the last step in your process when outputting to final. Lossless codecs are fine. I suggest that all your Blender CGI be rendered to OpenExr format with “Half” enabled and the default “ZIP” compression. ZIP. RLE, and PIZ are all lossless but ZIP generally provides the best compression for CGI which is probably why it’s the default. Half type is lossy but it’s nothing that you’ll ever be able to detect visibly so 32 bits per channel is generally overkill for VFX work.
I’m not the best person to comment on this but I can give you this link which details the preferred proces at revostock.com (a stock video exchange):
I personally convert my still image sequences to QuickTime’s Animation format which is lossless, supports alpha channels and provides a 2:1 to 3:1 compression ratio. I only do that whenever I’m working with CGI and 8 bit effects in Adobe After Effects and I have a fairly lengthy sequence (I have AE 6.0 and it sort of chokes with long sequences).
Actually I suggested the H.264 codec, not MPEG2 which is a complete dog by comparison. I have no idea what it means by Clenaing Up. You did ask about a format for computers, not DVD, right?
If you need audio simply go to the Audio tab and enable the “Multiplex audio” button. MP3 is best for web delivery but other than that I have no idea what the other extensions are for. You can only add .wav sound files in Blender and you have to sync it in the VSE.