Need Help! Encore/PRPro 5.5 Slideshows w/ stills & videos: Best workflow/settings?

Warning! Rookie here--I apologize ahead of time for the forthcoming dumb questions!
Gear: 4 month old iMac, 12GB RAM, Lion. CS5.5 Master Collection.
First, my goals:
*Take 4-500 large DSLR stills (shot in 24MB RAW and JPEGs from 6-17 or so MBs with some Sony panorama shots sprinkled in) and 20 AVCHD/Sony HD videos (only 10 to 30 seconds long and labeled as ".MTS" files) and create a slideshow with the videos interspersed among the stills.
*No audio, manual advance.
*Create high quality file from Blu-Ray setting for playback over Apple TV from iMac or iPad 3 to LED HDTV (1920 x 1080, I believe).
I've watched Lynda.com's tutorials regarding Encore CS.5 the past few days (watched the Premiere Pro course a while back for just a very short video DVD and I did OK--but no stills/no slideshow), but I'm quite confused and frustrated. For example, I tried to import the stills as assets and got an error message saying I didn't have the right software, leading to having to hit "return" for a few hundred error messages!
After lots of google searches and searching this forum, I surmised my files sizes are too large. OK, but that's about as far as I got for this stage. Then I saw Bill Hunt's article on workflow and about converting all stills to .psd files, so that may be next...?
But I would really like somebody to walk me through things that are still confusing given I am not familiar with all the terminology and things such as pixel/frame sizes etc.
Given my goals, what would be the best workflow/course of action? I don't need every detail given that I have the Lynda.com tutorials, e.g., I have some menus set up from a background image with text that I made in Photoshop and I get the linking procedure for creating buttons that work once the image is a item in Encore.
The main questions, I guess are:
1. What should I do with with my stills to get them into Encore? Should I do as Bill says and make them .psd files? How do I then get Encore to accept them as assets? I'm really confused about the sizes to use during conversion--4:3 vs. 16:9 and/or 720 vs. 480 vs. HD sizes (1000 x 750?!). I gather this should be done in Photoshop, but not clear how, exactly. (My head's about to explode reading up on file types, sizes, pixels, for the slideshows with stills and videos blah, blah, blah....).
2. How do I get my short videos into Encore? Do I create a timeline in Premiere Pro first? Should I create a timeline or sequence with both stills and videos in Premiere Pro and use the import sequence feature into Encore?
3. Where are the stills and videos best interspersed--Encore or PRPro?
4. Given Encore will only create slideshows of 99 stills, once I create multiple slideshows in the project panel, am I correct that I link to the second, third, etc. slideshows with "end actions" and the viewer will see a seamless transition? I plan on using some chapters for different sections of a 10 day vacation, so will there be any conflict with the multiple slideshow transitions?
Thanks so much for your help! This trip was a dream come true as I hadn't had a vacation in 12 years and I was finally able to take my now teenage boys on a proper wilderness adventure a few weeks ago! I would really like to be able to show everyone a nice slideshow and eventually give the boys a Blue-ray disc they will always have as a keepsake etc. In other words, lots of emotion wrapped up in this one.....thanks again!

1. Your images are square pixels, Blu-ray (BD) is square pixels, keep your images square pixels when you resize them.  That means a Pixel Aspect Ratio (PAR) of 1.0.  Fortunately, PS defaults to square pixels.  As for the frame size, the video will be the limiting factor if you want it interspersed with the stills.  Determine the frame size and frame rate of the video that was shot and use that as the basis for resizing your stills.  If you don't plan on doing any panning/zooming, then you resize your stills to match the video frame size (1920x1080 or 1280x720 are the likely choices).  If you plan on mild panning/zooming, then increase the size of the resized stills by roughly 30% in both dimensions.  More dramatic panning/zooming will require a larger increase in frame size; just don't go over 4000 pixels in either dimension.  And remember that video work makes any DPI or PPI value irrelevant.  The video frame size is exactly what it is, in pixels.  No more, no less.
2. and 3. If you want video mixed in with stills, then you'll have to put them all together in a Premiere Pro timeline before sending them to Encore.  Unfortunately, that makes the manual advance feature you want problematic.  It can be done, sort of, but it probably won't work the way you expect.
4. If you use Pr to create your stills/video timeline, there is no 99 slide limit.  Make the Pr timeline seamless and it will remain seamless in En.  If you do a slideshow in En, then moving from one 99-still slideshow to another will not be seamless.
NB: the key to your project will be planning.  Take and old-fashioned pencil and paper and layout how you want the audience to view the finished BD.  Do you want just the main program?  Do you want quick and dirty slideshows of just still images that they can access by menu?  And so on.  You can make *almost* any navigation scenario work in En, but you need to know beforehand how you want the audience to get from here to there and back again.
Jeff

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