XviD is not a good codec to use when editing, it's not designed to be used like that.
So the only solution to your problem is convert the XviD to another codec. I always convert to uncompressed avi format, that way I never have problems with the picture.
I good program to use is VirtualDub:
VirtualDub
or you can find a lot of good programs here to use instead.
Divx-Digest