I don't have any experience with either of these two services. Does anyone have any advice, tips or links to useful tutorials?
I'd recommend checking out the available integration libraries (http://zencoder.com/docs/integration-libraries/#libraries) that we and our customers have created to simplify your integration with Zencoder. You can read our docs (http://zencoder.com/docs/) and API reference (http://zencoder.com/docs/api) for more information about the options you can set. Our API Builder (https://app.zencoder.com/api_builder) will also help you get started with seeing how some of the options fit together.
As for S3, we work in Ruby and use RightAWS (http://rubygems.org/gems/right_aws). That would handle the transfer of files from your users to S3. If you're using another language I'd recommend checking online for an S3 library compatible with your language.
What I did is send movie uploads directly to s3 via swfupload so my Rails app isn't tied up with uploads. When the upload is done I use a JS callback to set the location of the uploaded file (bucket and path) in a hidden field that gets set in the ActiveRecord model when the form is submitted. If that attribute is present at creation time, a call is made to zencoder to start the encode. Then I use flowplayer to show the encoded videos.
It's a straightforward implementation, and it works well. I've been pleased as punch with zencoder, and I'd definitely recommend them. You might also want to look at http://www.pandastream.com/ ... it looks like a great alternative, but zencoder's pricing was a better match for this project.
By taking this approach, you won't have to worry about tuning encodes yourself, dealing with problem videos, etc. while also getting access to many other features that the client might be interested in (playlists, analytics, video SEO, etc.).
If you want to talk sometime and discuss various options and pros and cons for each, I'd be happy to help out. You can reach me at ben -at- wistia -dot- com. I'm the VP of Engineering there.