For compression codecs:
For distribution-grade compression, DivX is a good choice, but the fact that the DivX codec isn't as widespread as, say, MPEG-1 will hurt your distribution efforts. (DivXNetworks' attempt at sneaking in extra stuff in the Pro version hasn't really helped either, despite their honesty and published ways to disable it.)
If you want to reach the greatest number of people, use MPEG-1. There are legally free encoders out there, or at least I have one

Otherwise, pony up the cash and pick one. However, if you want a free alternative that looks good, go for DivX 5.
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I'm sure you've got a good solution here already, but for compressing archive video (i.e. stuff you will edit later on, and thus needs to be of very high quality) Huffyuv is a great codec. Unfortunately this places you at mercy of the AVI 2 GB limit. Sure you can segment and pick-and-choose, but if you don't want to for some reason...
...well, Quicktime is also great at handling high-resolution, high-quality uncompressed archive-quality video, and you don't run into file size limits (at least not as quickly). Quicktime YUV 4:2:0 planar and Quicktime MJPEG in particular are very good for this, the latter being better if you're especially concerned about size*. (Can Premiere handle those formats? Given Adobe's close ties with Apple, I'd expect it, but...)
Programs:
VirtualDub is nice; I personally use
transcode, but that's only because I'm crazy. For compression and final adjustments, VirtualDub will probably be your best tool.
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