Can you make it IMC?. This will help reducing storage used and lag while playing. Another problem for .avi now is videos can’t play with many players, need to convert first.
.mp4 is not just a format, it is a compression algorithm, just like .zip or .rar.
And just like you cannot compress a .doc file while editing it, you cannot just save a video in .mp4 while it is being generated, because the compression take a set of adjacent frames into account.
Also, running a compression algorithm will use cpu, so compressing while creating the file, would not help with lag, just worsen it
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