QUOTE (Imnewatthis @ Jul 6 2007, 05:30 PM)

I am still not clear on why I should capture in the .AVI format as opposed to MPEG-2. If the MPEG files are smaller it would seem better unless there is another reason for AVI.
one very simple answer -- DV AVI is not as compressed. When you edit by adding transitions, overlays, text, etc., the video MUST BE rendered in those places. Think of it kinda like making copies of old VHS tapes. After so many generations, the quality deteriorates.
Add to that, editing MPEG 2 can introduce other problems like video and audio ouf of sync because of the way MPEG 2 is compressed (very complex with 4 types of compressed frames). If are you are NOT going to do much editing, perhaps a few cuts, then using MPEG 2 should be fine.
Most editors have been designed for editing DV AVI and editing is much FASTER with these files. With compressed formats like MPEG 2, MPEG 4, DivX, etc., these files must be decompressed on the fly for editing and then recompressed in MPEG 2 for final output to video DVD.