Importing mpeg2 video

I have several .mpg (mpeg2) videos I created from a Hi8 Sony TRV-65 NTSTC (this camera only has s-video and RCA outputs aka Analog) to a Sony VAIO desktop using Sony's "click to DVD", at the file range from 4GB to 7GB in size. My problem is that when copy these files over to my iMac's hard drive and I try to import these .mpg files (under the "DEVICES" column on the left)into iMovie they are grayed out and not selectable. So I thought I would try importing video into iMovie from a newer digital Sony digital video camera, DCR-SR68, that will connect via a usb cable. When I hooked up my new camera to my iMac the new camera was selectable (under the "CAMEAS" column on the left) in iMovies and I notice all the movies on this camera were .mpg files too.

So I wonder why are these .mpg file selectable in iMovie and the ones on the iMac hard drive are not. I experimented and copyed some of my old cameras .mpg file to the hard drive of the new digital camera, and I fould that now these exact same old files are selectable and import with no problems into iMovie.

Here is my question, Why??? The old files are exactly the same the only diference is where they were stored when you selected them to be imported. I would think the process to import these files from either location would be the same. Is the new video camera doing some type of conversion when I am copying the file onto its hard drive or is there a bug in iMovie?

This solution saved me a bunch on work converting the old .mpg files to .mp4 files so iMovie would import the so I am not complaining, I just want to know why and to share my solution with others.

Can someone explain what I stumbled on?