The first question at the end of this http://ppro.wikia.com/wiki/Troubleshooting has a link to GSPOT to determine the CODEC used inside that AVI "wrapper" (I could name a MSWord file as myvideo.avi but that does not mean it will edit in PPro)
Most likely, you have a codec that is not designed to be edited... only viewed
Convert to DV AVI type 2 with 48khz sound for editing
point and shoot camera
Another term for a "point and shoot" camera is a "shoot and watch" camera, meaning no editing. You shoot, then watch. End of cycle.
If you want to edit, using standard pro camera formats is advised.
Along with John's tips, you will also want to setup your Project/Sequence to match your footage. As he suggests, use G-Spot to give you all details.
Now, if the CODEC is not one that PrPro can edit from, use his link on file conversion to get you to a DV-AVI Type II file and then choose either the PAL, or NTSC DV Preset, as that will be what you will have, once converted.
This ARTICLE will give you some background on AV file "wrappers."