First you need to rip and transcode your DVDs. Use HandBrake to do this. To make most efficient use of your time, use a ripping program (Mac the Ripper, RipIt, etc.) to rip a bunch of DVDs and then queue them up in HandBrake to encode overnight or while you are at work. If you are just going to use an AppleTV, use the ATV preset in HandBrake. If you want to watch them on an iPod/iPhone as well, use the Universal preset.
Tag your files if you like, using MetaX.
Copy your files to your Time Capsule. Then add them to your iTunes library by either holding the option key while dragging them or by going into iTunes prefs-->advanced and deselecting the "copy to iTunes..." box.
Sync your ATV so it knows where all your files are and you are set.