If you are using iTunes 10 or earlier:
Step 1: Select the video(s) you want to be iPad-compatible
Step 2: Click the "Advanced" tab at the top of the screen
Step 3: Click "Create iPad/Apple TV Version

If you are using iTunes 11 or later:
Step 1: Select the video(s) you want to be iPad-compatible
Step 2: Click the "File" tab at the top of the screen
Step 3: Click "Create New Version"
Step 4: Click "Create iPad/Apple TV Version"

iTunes will begin converting the files.