my 12" PB was my first Mac and i definitely regret it. i've been thinking about selling it and getting an older refurb iBook. why? read on...
for your needs, the SuperDrive is pretty slow in the PB. if you're going to be doing a lot of DVD backup you'd better be ready to hurry up and wait. takes about 45 minutes to burn a disc, and that's with third-party apps, a Finder-based burn will take twice as long.
DV editing/sound editing - i don't have much experience with this, but i'd suspect that it's pretty CPU-intensive. if you need raw MHz maybe a PC laptop is a better bet for you.
watching movies and internet.... any laptop with an ethernet card and a DVD-ROM will fit the bill here, PC or Mac.
the video card? you're right, it's not that great. newish games are going to be struggling.
you need it to be portable? yeah, that's why i picked the 12" over the 15" or 17"... the 12-incher has let me down, but i have desktops to use when i really need to get work done.
for what i use it for, the 12" is a pretty decent machine: DVDs, internet, word processing, email, data transfer to my Mac at work, compiling a big text file of all Mac OS X's silly UI quirks, looking at the pretty icons. but $2000 was a lot of money for that - a cheaper iBook would let me do all that and i could have used the money for something else. not to mention the other quality control issues about the 12" that have been mentioned... just check the Apple Discussions forums for more info. a simple search for "warping" or "latch" should give you some insight.
if i had to do it all over, i would have got a 15" PB and hoped that it didn't have any of its own problems... i also could have bought an entry-level G5 desktop with the money i spent on the 12" PB... i probably could have lived without a laptop.
if you must get the 12", at least wait a couple of weeks, they haven't been updated in a while and you never know what each Tuesday will bring.