Although I haven't exported from FCE expressly, for midrange bitrates (CD, that is), I'd probably just go with Apple's MP4 with the bitrate set high enough to fit your project on a CD. It's easy, and produces good quality video, provided the size is a multiple of 16 (that's VERY important, probably with all very modern video compressors). Probably just doing 640X480 is fine, image size wise, although I've gone down to 384X288 and still kept pretty good quality, though the source was poorer than DV on that one.
An alternate option would be to export as a full-quality DV-encoded MOV file from FCE and run that through OpenShiiva on 2-pass XviD encoding. Produces really impressive results (you can do the same thing with ffmpeg, but OpenShiiva is easier if you don't mind AAC audio). It'll take forever, and it's extra hassle, but I'm impressed with the quality of the output.