I'm also pretty new to this video editing game having recently purchased a Canon SX1 and having scoured the net for hours for advice, practised on short 2 minute videos etc this is what, to date, I have found works for me.
(a) The free player (VLC Player) plays back all types of video formats including MOV at a far higher quality than Quick Time.
(b) To reduce the size of the captured videos WITHOUT any apparent loss in quality whilst at the same time converting to an easily editable format (AVI) I have found that the free converter (SUPER) does an excellent job. Finding the correct settings can be a bit daunting at first, but again, by research and trial and error the following settings (in Professional mode) appear to be the best:-
Box 1 - AVI, Box 2 MPEG-4, Box 3 - mp3. Encoder -Mencoder, Video - No Change, 16:9, 30. The bitrate kbps setting seems to do a good job when set at 4000 but for even higher quality the 6000 or 8000 settings can be used. Audio - 22050, Channels 2, Bitrate 128, DVD language to default.
When converted the video file size drops dramatically but when the now AVI file is played by in either WMP or VLC there appears to be no difference in appearance to the original MOV file. By the way, the original file is left untouched with only a new AVI file being created.
This AVI file is now easily editable in Windows Movie Maker (WMM) or for more professional editing in Vegas Movie Studio Platinum Pro.
An important note - codecs has always been a bit of a mystery to me and it's not always made clear that various applications require the right bits of codecs. Another free application that should be installed, and that also installs every conceivable codecs one will ever need is ffdShow (current version rev 3014 2009-06-20).
One final point about Vegas Movie Maker Platinum Pro is that it is available as a 30day free trial and when you go to the download site that is what you see e.g. the trial of MMPP. What isn't made clear (until you purchase a licence) is that you also need DVD Architect 4.5 and the Cinescore Studio 1.0 plug-in in order to burn your project to DVD. These are also included in the purchase price of course and also available as trial downloads it's just annoying to find that when one comes to burn a DVD of a project that the option isn't available.