Afaik, conversion to real DVD structure is on the to-do list.
In the mean time, take a look at BD-Rebuilder
http://forum.doom9.org/showthread.php?t=143716. That one CAN output to a valid dvd structure, do note though that in doing so you'll lose ALL menu's and extras.
The method you'll want is under
- Mode > Movie-Only Backup
- Alternate movie-only output
- UNTICK "output BD or AVCHD Compliant Structure"
- select your option from the top 2 (DVD-5 or DVD-9)
- hit save and press backup to let BDRB do its magic
If you have IMGBurn installed, BDRB has 2 options > burn the disk directly after conversion or create an iso through IMGBurn.
BDRB has a small learning curve to configure properly, but once you do it works magic. I've been using it for years, long before CLBD came out.