I have been chasing this problem for a while now and everything I see is oriented to converting wmv and avi files to something that iMovie can read. My question is, wouldn't it be more simple to fix iMovie to read these files? That's something you would only have to do once instead of altering every file to accommodate iMovie. Often, you would then need to convert them back to something else after editing.
Or would it be easier (and cheaper) to just get a different editor and dump iMovie?
Otherwise, I love my Mac. :)