Is is possible to burn a 170 minute avi file in a 120 minute DVD?

proper dvd format?
i don't know since i usually burn avi files straight to dvd since my dvd player can support divx/xvid encoded avi's

If the video will be in lower quality than standard DVD it will be possible. Try to code it with SVCD quality - it should work.
To be honest - I never tried to do that ...

I would guess that since it's a matter of MBs, not minutes, there shouldn't be any problems BUT, as it has been mentioned, 120 minutes is calculated for some sort of standard DVD/video format. 170 minutes should therefor be possible when you lower the quality (think mp3 versus wav for audio).