This is what I use for MPGs,
http://www.versiontracker.com/dyn/moreinfo/macosx/15473
Besides splitting up MPGs it will Demux them so that you can bring them into iMovie and edit them. Then you can use it to re encode them back into MPG-1 files for the web.
I never mess with AVI files, but Quicktime Pro is suppose to allow you to edit them and export them.
Also iMovie is suppose to both import and export AVI, but I've never tried it.