It worked! What you have to do is after you install the newest handbrake, you have to "update presets" and then on the right side menu, you have to select "universal" under the Apple heading. It took about 2 and a half hours to encode Back to the Future, but it went into iTunes and is loading on my phone now.
So, I hope this helps out anyone having an issue.
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No joke, the iPhone has made me an apple believer.
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