IMovie 08 won't recognize avi format. How do I convert my files?

I just installed the new iLife up-grade to my iMac. The iMovie will not recognize all my avi movies (the old iMovie did). Is there a safe converter that I can use? Is there an easier way? What's a mother to do?

I just installed the new iLife up-grade to my iMac. The iMovie will not recognize all my avi movies (the old iMovie did).
More likely, iMovie '08 recognized the AVI compression formats and cannot edit the audio and/or video so it won't let you import it. Remember, iMovie '08 will only import files that it can edit. iMovie '06 only edited DV compressed files and so it automatically converted your AVI files to DV as they were being imported. For example, many Casio cameras use Motion-JPEG/DVI ADPCM compression in the AVI file container. iMovie '08 is quite happy to import/edit you Motion-JPEG video track but doesn't like the DVI ADPCM audio. Kodak owners have a similar problem with Kodak's use of MPEG4/µ-Law compression combination in an MOV file container. (Once again the video is fine but iMovie doesn't like the µ-Lay audio preferring a more standard AAC (MPEG-4 audio) format to go along with the MPEG-4 video.
Is there a safe converter that I can use?
Since these files are already conversion but edit compatible with your system, you have quite a number of options. You could, for instance, drop/import them to iMovie '06 and they will be converted to DV clips which can be edited in either iMovie '06 or '08. If in iTunes, they can be converted to H.264/AAC using iTunes. If you have QT Pro, you can use that to convert them to any number of edit compatible file formats. In fact, you can even use GarageBand to export the files to an edit compatible format. Then, of course, you can always download any of the free, donationware, shareware, or payware converters available on the internet and frequently recommended here.
Is there an easier way?
You can always continue to edit in iMovie '06.
What's a mother to do?
Sorry, that's not my department.

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I’ve also made some other comments about my experience with the camera, in case anyone was considering buying a Kodak camera in the near future.
I bought the camera just before Christmas 2004 in the US. At the time of writing, it is a pretty good model for domestic use—about 5.2 megapixels, costing about US$400 (or AU$600 back here in Australia). From a company as reputable as Kodak, I expected no problems.
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The EasyShare software is not as easy to use as it looks, has a habit of crashing, has a web update program that is always running in the background of Windows, and transferring images is nowhere as easy or quick as it should be. I’ve now uninstalled it completely, and simply copy the photos directly from the device. (If the camera memory is nearly full, and you just want to transfer the last few photos, then it’s impossible to use the EasyShare software to browse the camera’s photos without it actually downloading the whole lot through the USB cable—and it takes forever! Copying from the device directly doesn’t hit this bug.)
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After more angst, I found a number of websites in which frustrated owners of these Kodak cameras have reported the exact same problems.
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After realising that this would probably be the only way to get decent audio for these clips, I paid the AU$59 to Apple Australia to get the licence key that enables the extra “Pro” menu options in QuickTime.
Sure enough, you can “Export” any MOV file to a number of formats, including AVI. And guess what? The audio comes out fine!
So, the first piece of advice I can give is: pay Apple the US$29 (or whatever amount it is in your country) to upgrade QuickTime to QuickTime Pro.
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