Help with converting avi to mkv

i downloaded some episodes of futurama, they were in mkv format and only 50mb in size, but the quality was awesome. truly amazing quality.
Normally i have seen such good quality with rmvb, infact i convert episodes of family guy and futurama that are generally in avi fromat from a 230mb file to a 75mb rmvb file
i have my own custom settings and i did experiment alot before but this mkv thing is not sinking in or maybe i'm not trying hard enough.
but the fact is mkv is picking up real quick and it is sure to be one amazing container in the coming years, so i've been planning to switch to mkv since a year but i need help.

would someone experienced, please guide me to make a 230mb avi video file into a 50mb mkv video file without compromising on the quality?
to be more specific please tell me the software and the settings that you prefer and if not too much effort then also explain why those settings [if you don't mind explaining]

thnx

I think most mkvs are video encoded with the h.264 codec. I can't really help you on the settings cause I don't know what programs are used and at what settings, especially on Windows.

I know some programs for OS X and linux, but not Windows.

There may be some information available here: http://www.videohelp.com/

I know some programs for OS X and linux, but not Windows.
no problem, i use linux too so maybe you can guide me on how to convert to h264 codec and then make it mkv or wateva is to be done. i am just bothered with converting it.

There may be some information available here: http://www.videohelp.com/
nice source but it didn't do me any good.
all they have there is convert mkv to wmv HD or mkv to avi or mkv to vob.
lol! how ironical!
before when i wanted to convert MKV to AVI, i never found a source [now i found a good source]
but now that i want to do the opposite, i can't find the source for converting AVI to MKV
that sux

no problem, i use linux too so maybe you can guide me on how to convert to h264 codec and then make it mkv or wateva is to be done. i am just bothered with converting it.
I didn't realize they also have this for windows, but I use ffmpeg for converting a lot of things in OS X. http://ffmpeg.mplayerhq.hu/ The potential problem is that I use it with a front end, I'm sure there is a linux GUI for it somewhere.
There are probably some tutorials around on how to use it without a front end, but if you can get one for it it makes things much simpler. For example, this (http://homepage.mac.com/major4/) is what I use for it in OS X.