same for me with my MacBook core2duo
It's even worse with my MacBook Pro 2.2 LED. iMovie 7.1 won't see the HDC SD1 at all. The camera mounts on the desktop and shows up correctly in system profile but it's a no-show in iMovie 7.1 (iLife 08)
I've been in to see a pro video specialist and taken it into the AppleStore but everyone is stumped. I've re-installed everything ... no joy. Some have said 3rd party Quicktime plug-ins can cause a problem but removing them didn't help me.
The camera works with every other computer but it crashes iMovie when I select the highest quality.