There is nothing wrong with using your 700 mah pack, that is all that was used back a few years and we got good service out of them. If you want some good info on batteries, check out the following sights, especially the first one:
http://www.hangtimes.com/redsbatteryclinic.html
http://www.camlight.com/techinfo/techtips.html
http://www.whenshtf.com/showthread.php?t=2153
http://www.srbatteries.com/nimh.htm
http://dansdata.com/gz011.htm
http://users.frii.com/dlc/battery.htm
You will find a wealth of info in there and it will pay you to take the time to read them.
and, summerwind, we are not just guessing as some of us have been in this business for longer than you have been alive.