This is done by placing the 'correspondent' in track 2 and reducing the size so that it shows up as a picture inside of track 1. The exact way depends on the effect you are looking for. Do you have a screen shot or sample video?

I have doen videos in which I used a poster frame with green poster board on a wall. Then I used a chromakey to remove the green and had another clip playing as if inside the frame. Unfortunately I am having trouble getting green screen to work recently. __________________________________
CORNBLOSSOM

Best example I could find was this:

http://imageshack.us/photo/my-images/26/120515benlaboltcnnsg.jpg/

Ok, looks like they have a background image, which includes the lower third. Then the two sides are in other tracks and resized to half the screen. Place one person on track 2. drag the corners in the preview screen to make it half size. You may need to use a mask to get it the right shape.

Do the same for the other side, in track 3. The background image will go in track 1. I'll try to put together some illustrations, but it might take me a while.

It's the same process as I did here: http://youtu.be/qlWe0TpkHns __________________________________
CORNBLOSSOM

Great, thanks! Really appreciate it!

Ok, first you need the background image and both video clips imported into a project. Sorry, I tried to do a video screen capture, but this computer is getting pretty slow and just wouldn't do it.

Place the background image in track 1.



Then, place one of the video clips in track 2 and adjust to ahlf screen.



Last, place the second video clip in track 3 and adjust to the other half of the screen.



To adjust, highlight the clip in the time line and there will be corner markers in the preview screen. Just grab them and drag. You can also make more detailed placement in the PiP Designer (modify button). If the clips are not the right shape, you can also apply a mask, also in the PiP Designer.

If you need further help, just ask.
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CORNBLOSSOM

Perfect! Thanks