From memory iMovie can support DV format or MP4. (possibly some others...)
VLC can export to mp4 (i don't know about DV format)
I recently tried iMovie with a 90 min mp4 file and got the following results dependant on project type:
for a DV project - iMovie complained there was not enough disc space (I had more than 10GBytes free)
for an mp4 project - iMovie started importing then eventuall told me it would take 10 hours to import !!!
(When creating a new project in iMovie there is the possibiliity to specify the project type).
In the end I used squared5
http://www.squared5.com/ to edit the mp4 directly. (Great free utility)
There is another tool called dropDV
http://www.dropdv.com/ which will convert to DV format (but be careful this will make BIG files). (This is not free but there is a demo version)
Good luck