RE: help with format choice
MPEG (.mpg files) offer tremendous file size compression, but you either need a camera that can take movies in mpg format, or software like Adobe Premiere to edit it afterwards. I believe mpeg-4 is the latest version and allows sophisticated compression resulting in good quality clips small enough to easily upload or even email.
It's possible that Microsoft Movie Maker (free) or Pinnacle Studio (cheaper than Premiere) can do this format conversion but you would have to check out their specs.
There are also utilities you can buy (e.g. Movavi for $60) that offer extensive conversion capabilities.
Hope this helps!...Chris