I'm learning VirtuaLDubMod myself. Before you do save as "name.avi" you can tell VirtualDubMod which codec to use in the encoding.

Click on menu - Video - Compression and it will list all the codecs you can use. If you see the Panasonic codec we can ignore device manger as it means that it is installed.

Click on it and use that to make your avi and see if it plays back okay.

If anyone spots that I'm talking crap please step in and let me know.

Cheers