I am not sure that this is the best way ( but I am prepared to be corrected in case I did not understand).
You need the images to reside on your Local Hard drive to edit them and your workflow appears to be editing direct from your camera.
I suggest: You transfer the files from the camera with USB and EXplorer to a local hard drive ( not C:/ or where your application and OS is))
The above assumes your camera is creating files and in that case you are INGESTING the files. Not "capturing" or "digitising" them, which is what a CAPTURE WORKFLOW does.
BTW: A camera that creates files often uses an entire Folder struture which needs to be kept intact.
Shooter is correct as usual.
Though the OP instructions will work; its not a good idea to edit across a USB connection. It will be sluggish.
Importing files into the project panel does not move them. It simple makes pointers to the files (in this case across a usb connection)
And a bigger problem will be that that camera (with its card or HDD) will have to be connected, whenever one wishes to edit, and it cannot be overwritten to).
As has been mentioned, the Project file does NOT contain any Assets, with the exception of Titles created in PrPro's Titler. This ARTICLE will give a bit more background on what is in the Project file, plus a bit more.
The same sort of problem can arise if one Imports a VOB from a DVD-Video disc, without Copying the VOB's over to the HDD. First, that DVD must be inserted for each editing session, and things will be horribly slow.
Thanks to everyone for your replies, and corrections to my original post. You are absolutely correct that one would be better to copy the video files from the camera to the computer HDD before starting the editing process. Thanks for your help.
Most welcome. We just did not want you later looking for your media files, only to find that they have been overwritten on the camera, and are not available.