So I'm seeing this weird transition problem in my movie. I'm using iMovie HD with .dv clips extracted from a DVD using Cinematize. Can you not transition with .dv clips? (this is a cross dissolve, but it appears to happen on all)
See image here: http://homepage.mac.com/schubie/imovie.tiff
or:
See image here: http://homepage.mac.com/schubie/imovie.tiff
or: