I have just spent 20 mins replying to this and got a timed out page so I am really p***ed off!
Here is a very edited version for you.
I have same cam. Dont bother with usb. Wait 'til you get a firewire cable.
Go to Windows Update if you havent already. Update sytem and get Windows Movie Maker Update, version 2 I believe.
Loads of guides here and elsewhere to make dvds and lots of helpful people on this forum will see you through.
Let us know what software you have for burning dvds and authoring, ie making menus etc. If you have not got that kind of software, you can get trial versions.
Please, do yourself a favour and give up with usb. Its just for webcam function of cam and for emailing clips. You will just get fed up with it as quality cant be improved.
Also have a look here to get the whole process in mind so you know what you are trying to achieve.
http://www.marcpeters.co.uk/index.html
I hope this helps.