Every time I move something in the FCE timeline the entire timeline needs to be re-rendered.

Question

Tom (or ANYONE),
I'm working on a project with my students using Final Cut Express 4.01 using our iMac running OS 10.7.1.  we filmed using the Kodak zi8 in 1080p. 
I have two identical set ups:  an iMac with FCE4 using a Mercury Elite AL Pro portable harddrive as the scratch disc. 
On one of the two computers, whenever we add or remove something from the timeline (in a 3 minute scene) the ENTIRE timeline forces us to rerender! 
It's very frustrating and making the editing process almost impossible.
Help!
Here are a few screenshots to help in the process (hopefully):
http://www.flickr.com/photos/pushstartwagon/6511213139/  (entire screen)
http://www.flickr.com/photos/pushstartwagon/6511213219/ (properties of sound files)
http://www.flickr.com/photos/pushstartwagon/6511213175/ (properties of .mov files)

Answer 1

The problem is that you're trying to edit H.264 clips.  Neither FCE nor FCP works with H.264 video natively, hence the need to constantly render.
To use a proper workflow, convert the H.264 files PRIOR to importing them into an FCE project.  Since FCE only works with QuickTime DV or the AIC formats, you will need to convert the files so that they will match your Sequence settings in FCE.
-DH