I have no idea what is wrong. I've searched online and found people with similar problems, saying something was up with a codec or something. They mentioned downloading ffdshow and it should resolve the problems. Well I have that program already and it still doesn't work. When I'd try to add the AVI files, it looked like the Haali Media Splitter icon popped up for a split second in my system tray before that "file type not supported" error message appeared. I don't know if that has to do with anything (I'd downloaded Haali Media Splitter a few years ago with one of the other video converter programs I have... AVStoDVD I think).
If anyone has any idea how I could resolve this I'd be grateful. It's driving me nuts.