Acceptable video formats:
avi, mov, mp4, mpeg, mpg, qt, wmv, 3gp. For best results, try to encode videos using these compression settings.

General compression guidelines:

Codec
Choose H.264 for the video codec. Choose AAC for the audio codec.

Frame rate
This is usually 29.97 for USA/Japan/Canada.

Keyframes
Every 30 frames. This is basically how often the compressor references your uncompressed video.

Data rate
1800 kbits/sec for standard definition 4:3 video , 2500 kbits/sec for widescreen DV, or 5000 kbits/sec for high definition. Making these numbers higher will increase both quality and size.

Size
640×480 for standard definition 4:3 video, 872×480 for widescreen DV. or 1280×720 for high definition. It is also best to export 1920×1080 or 1440×1080 video as 1280×720 too.

Deinterlace
Yes. If you do not deinterlace, you will often get weird-looking horizontal lines in your video.

Sound sample rate
44.100 kHz

Audio quality
You want audio with a bit rate of 128 kbps. You can set your audio to really good quality without increasing file size too much.