Converting AVCHD Videos

I have a Panasonic DMC-TZ7 camera, capable of 720p video. For some time I was struggling with the MTS format that is used. Mplayer seemed to play it faster than the original. However, when uploading to youtube.com, the video plays fine. It also plays fine in xbmc.
I searched around a bit and found this syntax:

fmpeg -i $1 -vcodec libxvid -b 18000k -acodec libmp3lame -ac 2 -ab 192k -s 1280x720 $1.avi

The video played fine in mplayer, but after upload to youtube, the sound was off. Same with added

-async 48000

parameters to ffmpeg.
Then I have read this blog post explaining how to convert the MTS format to mpeg4.
First I tried the

-acodec copy -vcodec copy

thing, but the wideo can't be rewound in mplayer. Finally the syntax

ffmpeg -i $1 -sameq -f mp4 $1.mp4

worked best for me.