So what’s the founder of the Institute for Genomic Research doing at a Web 2.0 conference? Shilling for his new book, “A Life Decoded” (Viking), which arrives at market today, and chatting about the implications of DNA sequencing on medicine.

Venter, widely known for his work on the Human Genome Project as the former president and founder of Celera Genomics, takes the stage with conference co-host Tim O’Reilly (founder and CEO of O’Reilly Media).

O’Reilly opens with a question about the relevance of knowing your genome. Venter replies that it affects your attitude toward risk. Without knowing your entire genetic code, he explains, you can’t know what’s at risk. Venter, who famously sequenced his own DNA as part of his research, says the costs of sequencing DNA are dropping–his cost around $70 million, but with refinements in the process he expects that in a couple of years, the cost per sequence should go down to $100,000 or less. It won’t be long before it will become part of a standard medical work-up. And when it does, it will change the medical world. Genetic medicine is truly preventative, he says: “We like to pay for disasters, but we don’t like to pay to prevent them.” Venter cautions, however, that the nonscientific public may be challenged in interpreting all the new information.

On the subject of customized genome sequences, Venter says that companies like 23andMe that are commercializing genome sequencing need to be taken seriously. But this “revolution” should be approached with caution. At first, it was believed that we all had the same genes with minor variations, “but now we know it’s much more complex. Some companies are using just a fraction of the code, and that could be misleading.”

What about the obvious next step, taking the genome from read to read/write? “I’ve been trying to digitize biology for the past 15 years now. With synthetic biology, we can remake the analog genetic code in the form of DNA. … We are learning how to design life. We’re currently weeks to months away from being able to synthesize bacteria.”

Synthesizing bacteria? To what end? To change “everything,” says Venter. Replace the fossil fuels on which we currently rely, for example. “We now have biological fuel cells driven by bacteria that can take human wastewater and make electricity or clean water out of it. Each home can generate its own fuel in the future.”

But as for bio-engineered fuels, he says that ethanol is not the one you’d develop if you were looking to design a fuel from scratch.

(To read more on Venter’s conversation, see the blogs by Eric Savitz of Tech Trader Daily and Bobbie Johnson.)