I see this hasn't been answered so let me give it a shot.
1st - i don't think you can legally make copies of "Transformers 2". BUT if you have a video file you want to watch on the N1 - try Handbrake. (h264 or mpeg4, 800x480 pixels).
if you REALLY are fixated on making a "legal" backup of your purchased movie - google it. there are tons of apps that do this easily. Some free, some not.
GL!