There are many things that happens when upgrading (Application and Mac OS).
And it needs LOT'S of time !
I would if in Your situation do all these steps - Not just one and test as things can get even more complex by doing that.
• Trash iMovie Pref file (In User Library / Preferences - Not Library on Root level (the one You see when opening Your Hard Disk - USE the GO function above if it is hidden (Mac OS X.7 and 8 - it is)
• Run Repair Permissions - Disk Util tool
• Start iPhoto - YES iPhoto - but keep down alt-key and cmd-key - and select a full repair - THIS WILL take Hours to do - BUT as iMovie in Start-Up tries to find Your Photos and Videos stored in iPhoto - if this has any error - iMovie get severely STUCK
If PowerBook (Lap-top) Keep Mains-adaptor connected - so that You not run out of battery.
Yours Bengt W