Well, I downloaded the trail version for Vegas 7 today, just to try it out.
My problem is though, that every time I import a video file into the thing, it reads and plays it as an audio file, yet it still says it's a video file..
And 3. I really don't appreciate the language you just used. I'm sorry if I don't understand something you find so obvious, but it gives you know right to cuss at me for it.
ok... let me star over... AVI is a container, you can put several diferent types of encodes in that container. One is XviD - like yours is. You need to have the XviD codec installed to be able to work with XviD footage... but you should not use XviD footage in NLEs for the very reasons listed in the article I linked to earlier. The article also explains what your alternatives are.