there's no reason iMovie couldn't import anything Apple wanted it to. My older version of iMovie (iMovie HD) could import the .avi files created by my Panasonic lumix camera just fine. iMovie '08 now treats the files as if they didn't exist. O.P. os right to be frustrated - Apple picks and chooses what they want to allow to be imported (and converted). Apple could easily allow iMovie to convert any video format and import it. They just make choices that sometimes leave consumers (like me and the O.P.) out in the cold.
The problem with iMovie started with iMovie '08 (I still use iMovie '06 HD - Even on my Mac Pro 2010) - Final Cut Pro is my preferred platform now, but I still use iMovie '06 if im in a hurry and dont need advance features.