Note that the Lion installer deletes itself if you upgrade, so if you want to do this, you have to do it before you update your computer to Lion. You can always re-download Lion after the fact, but geez, who wants to do that? Once you've got it on your system, here's what you do:
1. Download Lion from the Mac App Store. The installer should show up in your Applications folder.
2. Right-click on the installer and hit "Show Package Contents". Navigate to Contents > SharedSupport and look for a file called "InstallESD.dmg".
3. Open up Disk Utility and drag the DMG file into the left-hand sidebar. If you're burning it to a DVD, insert your DVD, select the disk image in the sidebar, and hit the "Burn" button.
Reboot into OS X and hold the option key when you hear the startup chime. You can boot into your DVD drive from there.
You'll not only be able to install Lion from this drive, but you'll also be able to use Disk Utility, recover from a Time Machine backup, and do everything else you could do with the old installation DVDs. Note that when you install Lion, it'll create a recovery partition with all these features anyway, so you don't need the DVD unless you're doing a clean install.
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