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[Opendivx] Mpeg2 -> Mpeg4

I'm a third year student in collage. Every student in my college must choose a project to do durring his third/fourth year. One of the projects on the list was to write a program that converts mpeg2 to mpeg4 (or Mpeg1 to Mpeg2 - but that isn't as interesting) without uncompressing the mpeg2 to a full bitmap and then recompressing...rather to use the compression to further compress it to mpeg4.  (The professor in charge of the project said he himself doesn't know if it is possible.)
I wrote an email to the projectmayo team a while ago but haven't really gotten an answer yet, and I noticed a simular post here, so I was wondering if anyone can point me in the right direction. I kneed to know the following:
1) Is this at all posible
2) Is it worth spending time on (will compressing mpeg2->4 this way achive the same quality, speed)
3) Do you think it can be done in about a year (2 people that don't know much about compression working 15-20hours a week)
4) Where can I find a information on mpeg compression. (I've started going through the offical mpeg site...but I couldn't find information about how the compression works in all the mpeg documentation there.)
Thanks for any help,
Ezra Auerbach

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