The only reason I've ever wanted to convert a DMG to an ISO is so I can burn that DMG on a dual layer DVD on a Windows machine. Unfortunately, there is no way to convert a DMG to an ISO in Disk Utility. That's where a handy little Terminal command comes into play.

hdiutil convert /path/to/filename.dmg -format UDTO -o /path/to/savefile.iso

Just replace /path/to/filename.dmg with the path to the DMG that you want to convert. An easy way to do that is to just drag the DMG into Terminal.

Then replace /path/to/savefile.iso with the path to where you want to save the file. You may get the .cdr extension at the end of the new ISO, but you can just delete that extension and change it to .iso.