1. First of all ... what kind of video files are you attempting to use? (avi, mpg, what is it?) I am asking about those video you say is coming off of your camera
2. Did you test out video files in a media player like window media player and it play perfectly fine with the audio and sound you expect? For video playback, I would definitely install klite codec pack into your pc, as well as standalone divx and xvid codec and that should handle almost all major video file types. If klite codec pack installer tell you to disable or uninstall divx or xvid codec to prevent issues, keep the codecs on but disable ok.
3. These are filetypes supported by windows xp's version of windows movie maker, but I assume windows movie maker of vista also support same file types. I have only been using wmv, avi and mpeg files recently with the windows movie maker of vista.
Video files: .asf, .avi, .wmv
Movie files: MPEG1, .mpeg, .mpg, .m1v, .mp2
Audio files: .wav, .snd, .au, .aif, .aifc, .aiff
Windows Media files: .asf, .wm, .wma, .wmv
Still images: .bmp, .jpg, .jpeg, .jpe, .jfif, .gif
MP3 format audio: .mp3
Check it out and let us know what you find so we can assist you in troubleshooting your problem, but apparently as you see from above, we need more info to figure out what your pc is doing or what you are doing on your pc.