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Do i use mp4 or mpeg2 for editing ?

I have a Canon XA30, which outputs files in AVCHD or MP4 format. My editing software is Vegas Pro 13. If my goal is to produce a DVD (which will be playable in most DVD players) --- do I have to convert the MP4 files to Mpeg-2 before editing in Vegas? If so.. what is the best way to do that?
Any feedback/comments on this will be greatly appreciated... thank you!
 
If your computer can handle it, I would edit in whatever format it was shot in. But that's usually not possible, so editing by proxy is a common thing. I don't remember the name of it, but can anyone else remember that free codec Blackmagic released a few years back? Does it still exist?
 
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