If you are using a version of Windows prior to Vista, you will need to install the GPL MPEG 2 decoder to convert your MPEG 2 files. You can download it here: https://www.deskshare.com/download/mpeg2decoder.exe. This decoder has built-in support for AC3 audio. Please install this decoder and try your conversion again. You may also have to open the program Settings, switch to the Compatibility tab, and uncheck all AC3 and MPEG decoders.