Welcome to iMovie Discussions.
As you've already "..used iMovie HD to create holiday DVD's.." the best thing may be to re-use a short clip from a previous movie: copy - or import from your hard disc - a short one of those existing DV clips, and put it at the
start of your new project. Then connect your camera, turn it on (in Play mode) and
PLAY that first clip which is at the start of your project.
Then try importing.
By playing an existing DV clip first, you 'kick-start' iMovie into understanding what it should be dealing with, and it can become more receptive to accepting what's coming in from your camera.
After you've imported your material, you can delete that original 'kick-start' clip from your project.
It oughtn't to be like that, but it's often the way to get importing started!
P.S: How to reach those existing clips? ..In the Finder, go to your 'Movies' folder, and Ctrl-click on an iMovie Project (..one of those files with a star against it..) and choose 'Show Package Contents'.
In the list of files and folders which then appear, click the 'Media' folder, and copy one of those clips, within it, to your Desktop. Then, back in iMovie, import that file from your Desktop!