I just ripped a retail DVD that has 5.1 surround sound. It is an AVI video file without surround sound now, so how can I convert that AVI file or rip the DVD differently so that it has surround sound?
If you'd like to rip DVD movies onto your computer having 5.1 surround sound, you just need to set the audio codec to AAC/AC3. There are lots of video format container for you to convert, such as MPG, VOB, MP4, MOV, M4V, MKV, etc. But AVI video can't have 5.1 surround sound.
There are many dvd ripper tools that are capable of ripping and converting DVD movie to videos. However, just some of them can support ripping DVD movies to videos onto computer having surround sound.
Finally I found a DVD ripping tool called iFunia DVD Ripper for Mac on Google. This software is a free trial application for Mac OS X that accomplishes this task quickly and easily.

Step 1: Download & install iFunia DVD Ripper for Mac
We’ll be using a very nice DVD Ripping tool for Mac OS called iFunia DVD Ripper (Mac OS only) for ripping DVD onto computer with 5.1 surround sound, head over here and download the free trial version.
Step 2: Run iFunia DVD Ripper software for Mac
Now get your DVD disc and insert it. Then run iFunia DVD Ripper on your Mac and click the big button "Load..." to load your DVD movie, you may see the name of DVD Movie disk if you insert DVD disk before running this DVD ripper tool. This may take up to a minute or two depending on the contents of the DVD and the speed of your optical drive.
Step 3: Select the titles you'd like to convert
A movie DVD usually has several titles. The shorter titles on the DVD are usually the video backgrounds used in the DVD menu screens and DVD extras like movie trailers. Unless you are a graphic artist, you probably don't want to convert these titles.

Step 5: Change the output settings to output the video with surround sound
If you'd like to rip DVD movie to videos with 5.1 surround sound, you need to set the output video audio codec to AAC/AC3. There are lots of video format container for you to convert, such as MPG, VOB, MP4, MOV, M4V, MKV, etc.
Here I set the output video format to 'MP4 - MPEG4 Video File (*.mp4)', Video Codec as 'mp4v', Resolution as '640*480', Bitrate as '768', Frame Rate as '25', Audio Codec as 'AAC', Channel as '5.1'. Do remember to set the Channel to '5.1' from the default '2'.
Step 6: Start converting DVD movies
Now you may click the big button "Start" to begin converting DVD movies onto your hard disk. The Convert progress bar shows you how much of the convert process is completed. The longer your movie and the larger its Bitrate, the longer the convert will take. The ripping time will depend on several variables including: the duration of the video file, the speed of your computer, what other activity your computer is currently doing, the codec you selected and the bitrate you set.
Once the convert is complete, iFunia DVD Ripper will place on your Desktop a new version of your movie that will play on the iPod. Double-click the new file and play it to make sure it looks as you expect.
DVD Ripper for Mac is a powerful yet easy-to-use DVD ripping software to rip DVD movie to videos having 5.1 surround sound. It helps you rip and convert DVD content to any common video formats for playback on media players and mobile devices.

(PC user? Get Windows version here)