|In iTunes, your music & videos are just shortcuts.|
The actual files which you need to convert are in a different folder, usually in a sub-folder of your Windows user account name (where you are supposed to save them to make backing-up easier). Normally they should be saved here:
C:\Users\<my account name>\My Music
C:\Users\<my account name>\My Videos
(Unless you've saved them on your desktop or in a different folder than those shown above).