1. Virtualdub and VFW codecs for windows are great. Is there anything like this for linux?

avidemux2 is an advanced native linux video editing and encoding tool with a GUI interface very similar to virtualdub's. It supports many video codecs and output formats. Unlike virtualdub for windows it is more difficult for codecs to be supported in avidemux, however since it is not VFW based it is free to be much more versatile as far as output formats and advanced video codecs. avidemux supports more codecs and formats with every release and is a great application to get started with encoding video under linux.

Some people have successfully gotten virtualdub working under wine; however, keep in mind that virtually all of virtualdub's tools (aside from proprietary codecs) can be used in native linux apps.

2. What native tools are available for general purpose encoding?

GUI (graphical interface) Tools
avidemux2: easy virtualdub-like interface, many filters, codecs, and formats are supported.
dvd::rip: A GUI frontend to transcode, built-in DVD ripper, supports many different codecs and output formats.
acidrip: a DVD encodeing frontend based on mplayer/mencoder.
drip: A DVD to DIVX conversion application, supports MSMPEG4, OpenDivx, XviD for video, MP3 audio, has problems with some NTSC DVDs.
CLI (command-line interface) Tools
mencoder: The encoding application paired with mplayer, supports a vast amount of input formats, processing filters, and output codecs, although output container formats are currently limited to AVI and MPEG output format. See here for a tutorial on the command line interface.
transcode: a suite of CLI utilities for transcoding video and audio based on a modular structure. Supports many codecs and containers. See the wiki for command line help.
ffmpeg: a complete recording, converting and streaming solution, based on libavcodec/libavformat. Supports most of the codecs supported by mplayer as well as a few more container options.