Suggestions for a good intermediate format for HDV?

Question

If I read in video from my Sony HDV camcorder (at "Full" size), it is converted from the original HDV format to the AIC format. I'm finding that AIC files sizes are about 45 GB/hour, so 11 tapes will fill a 500 GB drive. This file size is really too big to be very practical, so I'm looking for another intermediate codec that will yield smaller file sizes.
I used QT Pro to convert an AIC test clip to the h.264 format. Here's what I have found so far. I set the Quality slider halfway between "medium" and "high". The resulting clip was very close in quality to the original AIC. There were some subtle differences in areas of low contrast, but it would be difficult to say which was "better". So as far as quality goes, this setting seems good. (Using the medium setting resulted in video that was clearly worse than the original, although not bad by any means.) The file size corresponded to 10.7 GB/h, or about 4X smaller than the original AIC.
However, using this h.264 clip in iMovie 08 was hopeless: Any action on the clip lead to the spinning cursor for a few seconds, and the skimming was hopelessly jerky and slow. The reason, I found, was that QT was inserting only occasional keyframes (I had Keyframes every... set to Automatic; not sure how often this will put in a keyframe, but I understand that in HDV it's every 15 frames), so that this h.264 clip was really no more editable than raw HDV would have been. So I started experimenting with how often the keyframes are put in and found the following:
<pre>_Keyframe every: GB/h Skimming quality_
Every frame 24.3 Good; not as smooth as 960 V 540, but acceptable
Every 2 19.0 Useable but a little jerky
Every 8 14.7 (like HDV) Pretty jerky. Usable, but would not be fun to use
Every 15(?) 10.7 Hopeless.
</pre>
My question, then, is whether there's some other scheme of compressing the AIC files to another format that iMovie 08 can use, while keeping the image quality high and allowing for smooth scrubbing. (Using keyframes every frame is not a bad choice, since it does reduce the file size by nearly a factor of two. But is there something even better?)
I should add that the compression takes roughly 8 hours for a 1 hour AIC file. This would be OK with me, since I can just run it over night. (MacBook Pro @ 2.2 GHz)

Answer 1

Dan, there has been alot of discussion over this over the past 24 hours. I read the threads and try to decide based on the opinions of all of us. Gosh, amongst us all, we could author a fanatastic "how to" and "what works" book. I know you are anxious about what to do that is best, but honestly the best advice I can give you is just read the threads and see what viewers rate. I have my opinions, but shucks, that is only based on my short term experience, and I am still learning everyday from other postings. Go for the reading and then take alook. Be advised though, the stores are not up in stock compared to the websites. Good luck!