The
Technical Guide explains how there are various containers for videos, and there are two types of video formats that can go within those containers: 1.Those encoded with Editing-Friendly Codecs; and 2.Those encoded with Distribution Codecs. You will want to convert using an Editing-Friendly (Lossless) Codec. I recommend UtVideo within the .avi container. The files will be much larger, but the big advantages are faster seek-time and frame-accuracy within your editor (and ofc minimal quality loss)
To make the conversion, follow the guide above, but it's a hefty read, so I made a quick and dirty summary here:
viewtopic.php?f=45&t=103579#p1373940After you are done editing your AMV, then you can compress using a Distribution Codec. (like x264 within .mp4/.mkv)