Unfortunately, you have posted to the Tips & Tricks sub-forum, which is basically a repository for articles on how to do things in PrE. Maybe our tireless MOD, Steve Grisetti, will move it out to the main forum, where many more people will see it.
As for IEEE-1394a, you would NOT be using it for networking. Most modern MoBo's have an IEEE-1394a controller chip, but almost any add-on FW 400 card will have those too. As of at least XP, Windows has included FW 400 support.
Today, the add-on cards start at about US $8 and go up to about US $60. What one gets, as the price climbs, will be more ports, separate controller chips, ideally one / port, and then possibly additional ports, say USB. I like the cards by SIIG, but there are many other good brands too.
As for Capture, which is the process of Importing the data on mini-DV tapes, it must be done via FW 400 (IEEE-1394a), to be done in PrE. However, other programs might offer alternatives, and so long as one ends up with a DV-AVI file, things should be fine. Those DV-AVI files would then just be Imported into a PrE Project.
The preview in PE is lower quality than the original so it can be edited faster. (Right click on the pic for 2 settings, poor/fast and better/slow)
The only way to judge the quality is to compare the original footage with the final product you make.
In the case of a DVD, it will always be slightly worse due to compressing the file no mastter what editor you use.
A 90 minute AVI DV tape uses about 20gb whereas when you makle a DVD of it it compresses to 4.7gb
Different computer player software differ in quality a lot.
A DVD and an AVI look different on Windows media player, RealPlayer and GOM player.
The best pic from a edited DVD is usually got from software specially designed to play DVDs you hjave to pay extra for and it can be better than the original AVI file viewed on Windows Media Player.