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Resetting your version of iMovie would be a good troubleshooting option. It seems that you might have deleted the shortcut instead. Try deleting iMovie's preference file. If open, close iMovie then in Finder navigate to the file named "com.apple.iMovie8.plist" in your User (Home) folder Library>Preferences. Drag this file to the Trash. When next opened iMovie will create a fresh file with the default settings. You may need to change some settings to suit your own preference. To do this, in iMovie's Menu go to iMovie>Preferences and make appropriate changes in each of the tabs.
See this Apple article for more on iLife Troubleshooting Basics (includes a reference to deleting the preference file): http://support.apple.com/kb/TS3249
Note that, if in fact you are using iMovie '11 (which is version 9 - latest update being 9.0.2) you need to delete the preference file named "com.apple.iMovieApp.plist" which resides in the same Library>Preferences folder.
I put "com.apple.iMovie8.plist" into the trash. That didn't do anything.
I Have iLife 11 so I put "com.apple.iMovieApp.plist" into the trash along with "com.apple.iMovie8.plist".
Doing this I lost "Edit Project" in the Project window.
I will go to the iLife Troubleshooting site to see what there is that may help.
Thanks for the info and have a good day.
I went through the operation as above again and iMovie worked OK as before, I did not loose "Edit Project" in the Project window as the first time I did it.
What brought up my External HD was clicking the "Group by Disk" button just across fron the "Events Library".
All the time and effort spent for the click of a button. I don't know how it got set funny, I never use it. I found it by accident.
Thanks for your attention, Jerry