If you don't want to compress it (ie leave it same as the orignal), set settings to 16bit-stereo, 0 compress level for no loss, and 44100 for the sample rate). /end edit
I think from memory the original would be 44k 16-bit stereo, so anyone who knows about sound will know that converting it to 22k mono will quarter the audio size, leaving more space for the video (so it wont need to be as compressed). If you're an audiophile you may wish to leave the sound alone and focus on compressing the video more.
-Click on Batch when ready to begin, and then Start.
-It appears to rename the files with a new_*.* at the start. Once done you will need to rename the files by removing the new_ from the beginning.
-Transfer back to xbox/make iso and burn.
With the settings I used, the results still look pretty good. You will need around 3gb space free, and some spare time. On my 1Ghz 384mb machine it took maybe 4 or so days non stop to complete
So be prepared for this.
Hope someone finds this info useful. I would guess the NTSC version will be similar in size, and these instructions should still work since I imagine they'll still use the bik files.