Yes, it makes sense to both shoot and edit in HD, and only export in SD. From both footage and effects point of view.

I won't comment on previous answers .. but realize that you may need, depending on what you have now, a newer, more powerful computer to edit HD

I think its worth shooting in HD (if you can afford it, both in dollar-cost of an HD camera and Computer-cost for the CPU cycles), for one simple reason.

You can over-shoot in HD (shooting more than your subject, having your subject relatively small in frame), then crop in the editor, and still not lose any resolution.

This gives you the ability to compose your shots after the fact, possibly smoothing out camera jerks or instability, and giving you more protection against your subject going out of frame, or even to the edge of the frame.

ABSOLUTELY.

I currently do the exact same thing. I use an HDC-SD1 (Panny's first AVCHD camcorder). It was a hugestep over my old Canon miniDV. Playback is typically via DVD on an a plasma TV (EDTV). The difference in clarity even with downrezzing is ridiculous. The DV footage looks like it was shot years ago.

If you have the cash for the camera and the necessary computer power, go for it. I have no reservations.

These replies are pretty convincing in favour of going down the HD path!

Realising that this is a Movie Studio forum, I don't want to turn it into a hardware review...
However, when I edit my video, will the quality vary that much depending on whether the camcorder uses MiniDV, flash or HDD to store the footage?

I suppose the main difference will be the compression that is used for the video. Storage space might be an issue to consider as well, especially if I am archiving it for conversion to HD (instead of SD for my current screen) sometime in the future.

Thanks again, J.

Here is my favourite list:
1) canon hv30: best quality, highest price, on minidv
2) canon hf10: lower bitstream than hv30, 16GB built in
3) canon hf100: same specs as hf10, but only flashcard memory

The HV30 is much cheaper than the AVCHD cameras now. It's sold for a mere $600 in the US these days. When I got my HV20 I paid over $1000.

Definitely not SD because of the above reasons - you can, however, also go half the way buying a camera recording in 720p. This format gives very good results by not stressing your PC so much as full HD.

I have just been through the same thoughts and ended up with a SONY DSC-T500 - which I can really recommend.

I tested several cameras in the selection process - and it showed that 720p is many different things - ranging from that Vegas could not manage some of the videos to that some 720p recordings were way more blurred, jerky and unsharp than SD.
There are several T500 examples on Vimeo - some of them also showing a path where you can download raw 720p from the camera.

I am in the same camp as everyone else. I use an "HD" (720p) camera to get the best raw footage I can get (on my current budget, that is.) Then, I edit and create in 720p since the best way to share videos these days is on Vimeo, etc.

For cases where I do want to show on my actual TV (non-HD) I create a DVD with content that winds up being letterboxed. The quality is still good, though.

Finally, for any completed projects, I also make sure to save a high-def version of the completed render for the day when maybe I'm burning Blu-ray or some other format that supports higher resolution than SD.