Welcome to the forum.
What are the specs. of the Source Files, and what is the Project Preset, chosen at New Project?
With the Duo-core CPU, if you are editing HD material, and especially AVCHD, or some flavor of H.264, you will never have really smooth playback. The best that one can do is to tuneup the system and OS, and then, if there is a red line above the Clips in the Timeline, hit Enter to Render for best playback. This ARTICLE has some tips on tuning up one's system and also the OS.
Good luck, and please let us know some more info.
PS - the Photoshop.com storage should not have any impact on the performance of the editing.
How do I decide what Project Preset to use? My source files are all over the place. Some are ripped from DVDs or YouTube, some are downloaded from internet or sent over the internet and some are from hard drives. So I've got MP4, 3gpp, mov- I'm all over the place.
THen of course some are in HD, some have black borders top and bottom, or all four sides. I know that has to do with source too so I can't change that but its all messy.
So my counter question was how to choose a Project Preset.
But then the kicker is, I've been editing projects in Adobe, then "Share" ing them so I can then edit them all together in one big Adobe Project. Only how do I decide what format to "Share" them in? What format is best to continue editing in Adobe?!
The ideal is to match the Source Files to the Project Preset, as closely to 100%, as possible.
If one has multiple sources, and they differ much, I would recommend doing "intermediate" Projects, matching each. Then, output a file from each of those Projects to match the bulk of the footage. As an example, if one had SD Widescreen 16:9 as their major source, but then several different HD Clips, I would create an HD Project, matching each type, and edit. Then, Export/Share to DV-AVI Widescreen 16:9, for Import into the "master Project" of DV Widescreen 16:9.
If I had, say Flip HD, AVCHD and HDV, I would create a separate Project for each, matching that footage, and then output to match the bulk of the footage. I find the results better, and the editing easier, when the Project matches 100%. When one mixes a lot of different formats, there are usually issues.
If you have a mixture of, say DV Widescreen 16:9 and DV Standard 4:3, you have a couple of choices. For that Standard 4:3, you can use it in the Widescreen 16:9 Project and leave the black bars, or you can adjust the Scale of the Standard 4:3 with the Fixed Effect>Motion>Scale, to enlarge that to fill the screen, and effectively crop a bit of the top and/or bottom, by adjusting the Motion>Position. A little Scale will likely never be noticed in the final Project. The ultimate choice is yours.
The one exception to the above, would be if one was creating a SlideShow, with NO Video Source Files. Then, they could decide what the ultimate output would be, say a 1920 x 1080 HD file, or BD, and then Scale those Still Images in Photoshop, or Photoshop Elements to ~ 1920 x 1080, and edit the SlideShow in an HD 1920 x 1080 Project. Otherwise, the output is the last consideration, and is handled with the Export/Share settings.
Good luck, and happy editing,
When I am outputting files, that will require additional editing, I will choose one of two options:
If it's a DV Project, I will Export/Share to DV-AVI in either Widescreen, or Standard, or will use an intermediate CODEC, that is lossless, such as Lagarith Lossless, or UT Lossless. Those are especially good, if one has HD material. This ARTICLE goes into more detail. It just depends. Note: DV-AVI is slightly compressed, so if I will be doing a lot of work, and maybe additional intermediate file Exports/Shares, I will skip DV-AVI, and choose Lagarith, or UT.
As for the ultimate Export/Share settings, the delivery will dictate that for me. This ARTICLE goes into a bit more detail on the considerations. Note: it was written for PrPro, which offers more options, but PrE has a bunch.