Easily convert & archive a bunch of low res Video CD DAT files MPEG 1/2 to newer better format such as MKV or others?
Using ffmpeg, a free command-line tool, you can convert these DATs to MP4 (or MKV):

ffmpeg -i input.dat -c:v libx264 -crf 20 -c:a aac -b:a 128k -movflags +faststart output.mp4


Your VLC output doesn't mention it but if the inputs are interlaced (likely), then use

ffmpeg -i input.dat -vf yadif -c:v libx264 -crf 20 -c:a aac -b:a 128k -movflags +faststart output.mp4