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iTunes has DRM (digital rights management) restrictions on their movies that would prevent you from burning a movie to DVD. The iTunes FAQ has details about how an iTunes movie can be used. Here's what it says about movie usage rights:
What are the usage rights with movies?
You can transfer to five computers, sync with all the iPods you own, and burn to DVD for data archiving purposes only (not for DVD playback). You can also sync to up to five Apple TVs which don't count as one of your five computers.
So, iTunes would allow you to burn purchased movies to a DVD in a storage format, but not in a playback format.
You can read more about iTunes DRM on WikiPedia.
Hope this helps,
O'Reilly Media, Inc.
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