This is the third time I have installed Ubuntu on my pc along with Windows 7, but every time I install, I have to upgrade all packages. (Almost 300 - 400 Mb). Is it possible to make a bootable DVD of my current installation so that I don't have to upgrade all the packages next time?
While not directly related to backing up your system to DVD ISO media, you should have a look at the excellent community documentation for backing up your Ubuntu system. Backup Your System
You could also clone you whole system with
dd. See the following link for more details: http://www.backuphowto.info/linux-backup-hard-disk-clone-dd