All about movies

[beano]

Okay, I'm finally getting back into making freesites. I haven't submitted any for months and months, but since I'm still making decent revenue from my old sites that I submitted around a year ago.....I'm back, baby! I've kept myself busy promoting online poker. Hint: you can make $150+/sale in the poker market...

Anyways, I've always made my sites with pics, and never done anything with movies. A few simple questions:

What program(s) should I be looking at for "chopping up" a full length movie? What settings should I use? Is there a preferred file type (.mpg, .wmv)?

Can I just add .mpeg (or whatever file type I make them) to my .htaccess for hot-linking?

Is there anything else I should know?

Thanks!