What do you guys consider to be the best codec? Which one balances both compression and quality the best?
Personally, I have found that the Indeo 5.1 codec is a very good one. It is very fast, reliable, and does a pretty good job of compressing. If you set it to 100% quality for a 1 min 640x480 video, I think your looking at about 30 MB. The lower settings seem to still produce good results, but 100% is pretty much visualy lossless.
HuffyYUV is a good lossless codec, but I seem to have problems with it being compatible sometimes, and it doesn’t compress a whole lot, but it is lossless, and isn’y too hard to get to work.
Divx 3 or 5 are good if you are putting it on the web for small size Quality is descent when you have the quality sliders up, but it is a little slower/ takes more processing power to render too.
Hope that helps. 
As Blazer said
Huffyuv is very good, and is lossless.
DivX is my one of choice, and is compatable with many new DVD hardware players. Unfortunately they have just produced version 6 which is not Freeware. I think Version 5.11 was the last free one. Also consider Xvid. This still a free version of DivX. Ive used this for film compression and seems to give better results than DivX.