Dear davyzhu,
MEPG-1 is the standard for VCDs and MPEG-2 is standard for DVDs......
They both use the same tools but MPEG-2 has few advance tools like Interlaced Videos......... Otherwise no major difference...........
Actually the target bitrate of MPEG-1 was for VCDs only hence it is a constant bit rate standard too.............. while MPEG-2 has a facility for Variable Bit rate and its peak bit rate is 10 Mbps and minimium it can go below 1Mbps too
If you want to do compression of CIF [352*288*30] then u can use both standards but it also depends upon what is ur target application..... MPEG-1 and MPEG-2 are both for multimedia. But i thin MPEG-2 is mostly done on FULL-D1 and for CIF it is prefered to use MPEG-1 but again i think it will be a constant bit rate...