Riight...
For ISO Playback see above

For burning anything to disc you have 2 options - CD or DVD. As mentioned earlier, you can use normal CD-R discs to make a video CD or super video CD (the latter is better quality, but fits half the ammount of a normal VCD on - 40 minutes I think as opposed to 80ish. Also, SVCDs may not work in all DVD players)
To make a VCD I`d recommend Nero, sometimes called Nero Nurning ROM or Nero Express; I was lucky since it came pre installed so have used it to make a lot of VCDs and can recommend it as such. Also be aware VCD resolution is quite low - why I don`t use them anymore - as downloads have approached semi pro or better quality, a VCD is still limited to 352 pixels across.
To make a DVD you seem to have one option; a DVD burner. This is your best bet IMHO. As I said, the prices now are nothing like they used to be. Even an external drive with USB connection is £40 at my local store; around $70US. This will burn all your downloaded videos, ISO files, and camera videos (assuming they are AVI, or MPEG1/2/4)onto DVD. Some drives come bundled with software; see if any has it (again, I`d go for a basic OEM Nero) - Nero 7 is an $80US download right now, but it`ll burn everything apart from unconverted FLV files in my experience. Others may have their favourites.