I've been a a fan of hard drive camcorders ever since I purchased a JVC Everio GZ-MG50 a couple of years ago. The convenience of not dealing with tapes plus instant random access to the footage really made the recording and editing process more streamlined. However, the quality of the MPEG-2 video was not as good as DV and most mainstream video editing applications seem to have a hard time dealing with MPEG-2.

Thus, it was a nice surprise to see that iMovie 08 supports editing of all the major video formats outside of DV such as MPEG-2 and newer formats such as AVCHD (Advanced Video Codec High Definition) and the MPEG-4 standard H.264.

I've found that recompressing standard definition video with MPEG Streamclip to H.264 format yields much smaller files: on the order of 1/20 the size of DV footage and 1/3 the size of MPEG-2. There is very little, if any, quality loss evident in the video re-encoded as H.264 and I'm quite happy to use this format moving forward since it appears to be the format that is gaining acceptance across the board, e.g., Flash 9 and YouTube are both supporting H.264 these days.

I'm in the process of converting my old DV and MPEG-2 footage to H.264 using MPEG Streamclip. It's time consuming, but it yields tremendous savings in disk space.