DVD Decrypter to rip the video.
VirtualDubMod to make and compress the actual clip.
I'm gonna keep this simple.
In DVD Decrypter, select the relevant vob file (go by the 'title' number of the relevant episode), choose where to save it, save it.
In VDub, open up the ripped vob file, select the segment you wish to save (using the bar and black arrows at the bottom), set the compression codec (to something like DivX) and the bitrate (through the 'configuration' menu) and save it.