OK for starters, the DV codec is used for mini-DV tapes that were very popuplar from about 1995 through 2006 when the high definition AVCHD camcorders started taking over the market. If your camera uses tapes, you probably use DV. These will be in standard definition, which is fine for DVD which are also standard defintion.
Some tape camcorders can shoot HDV, which is 1440x1080 MPEG2. This is converted to Apple Intermediate Codec on import.
Many modern camcorders shoot AVCHD. This is automatically converted to Apple Intermediate Codec on import.
This is a high definition format that typically shoots 1920x1080 or 1280x720. AVCHD is a variant of h.264.
Some camcorders shoot in h.264. h.264 files can be anything from the tiny 320x220 movies of the older cell phones to 1920x1080. For the smaller sizes, iMovie can edit the h.264 natively. For the HD sizes, you should convert to Apple Intermediate Codec. This is called Optimizing.
For why Apple Intermediate Codec is involved in all this, see this post. https://discussions.apple.com/docs/DOC-3941
When you SHARE your iMovie project, and use EXPORT MOVIE, SHARE TO ITUNES, SHARE TO MEDIA BROWSER, SHARE TO YOUTUBE etc. your movie is always rendered in h.264.
You would think that sharing to iDVD directly in DV or AIC would produce better results (using SHARE/iDVD), but for most people, sharing through h.264 looks better. This is possibly because of the way iMovie deinterlaces.
In addition, when you SHARE/iDVD it produces a single very large temporary file. This files goes away after you create your iDVD project. Finally, when you share to h.264, it becomes much easier to have multiple iMovies on the same DVD. When you SHARE/to iDVD, you have one movie per DVD.
You would usually not ever want to save a high definition file in DV codec. (you would lose the high definition)
Having said all that, here is how you can tell for sure what codec your camera uses.
Right-click on one of your Event clips. Select "Reveal in Finder". You should see a Finder window with the clip selected. Right-click on this clip and select "Open With.../QuickTime Player".
Now, in QuickTime Player, type Command-I to open the Inspector. You can see the audio and video codecs next to the word "Format" in the Inspector.