(Why can I drag-n-drop photos onto iMovie, but NOT video files?)
I'm not a Mac user, but at a guess, given the large variety of video formats, iMovie may not be able to handle the one your particular camera uses, at least not raw. Maybe iMovie has some provision for importing
other formats? Or you could try hunting down some kind of transcoding software. I use Handbrake (in Windows XP & Vista) when I want to get some video into a format that'll work on my iPod.