I have a BUNCH of home videos that we have recorded on hi8 tapes and I want to transfer these to digital.
I have done LOTS of this.
You will need a FireWire analog to digital video converter (If you have no Hi8 player with FireWire). I like the Grassvalley ADVC300. Audio and Video go in, FireWire comes out.
http://www.grassvalley.com/products/advc300
I've played around with countless other conversion systems, ranging in price from $79 to $399. Short verison, this is the ONLY unit to own. No dropped frames at all, even with questionable quality tapes, no jitter, great color, excellent sound quality. Zero setup with iMovie 06 and iDVD 09/11.
This is a prosumer deck. The time code function is alone worth the price if you have old analog footage. Absolutely NO "Out Of Sync" audio.
ADVC300 is for anyone who wants to do editing and is concerned about quality of color and speed, for the novice it is an incredible gizmo that will restore tapes to a state close to the original fixing midtones, highlights and shadows on the fly. Not only can you simply convert analog to digital you can actually manipulate the signal going in (if you want to).
A bit pricey but it WORKS.
The program that comes with the ADVC300 has some nice filters that can improve video and audio of the source material.
I would use iMovie 06 with iDVD 11.
iMovie 11 uses 'single field processing' meaning every other horizontal line of the video is thrown out, which reduces the sharpness of the footage. iMovie 06 uses ALL of the image to form the video.
I like and use both iMovie 11 and iMovie 06, for Transferring Hi8 to digital you will get a better end result using iMovie 06. You can find iMovie 06 on the iLife 06 install disk.