Hi, I'm new to video editing. I recently purchased PD7 Ultra. My question involves which video format to edit on. I currently have an analog video camera where I capture the video through S-video and the sound through my PC Mic. I can capture the video as a large AVI file or I can capture it in MPEG2 format. My computer is a Core2Duo E7200 with 500 Gb HD and 4 GB of RAM so computer power is not an issue.

Here's my question. If I want to ultimately burn my video on a DVD should I capture the file in MPEG2 format initially or capture as a large AVI file and then render it in MPEG2 format at the end? If I edit on the captured MPEG2 file will I lose quality during the editing/rerendering process?

Is it ok to render small clips of video (MPEG2) of a larger project and then put each small piece together at the end to make the final project?

Finally, whenever I drag a captured video into the timeline I always get a compatibility warning. PD says that it can convert the file, but that might cause loss of quality. I check the preferences and it seems that everything is alright. The video was captured in NTSC and that's what I have PD setup for. Any ideas?

Thanks for your help,

Jim Q9300 2.5 GHz
4 GB Ram
Nvidia 9800 GT