Wow, something I can answer (hopefully):
I had exactly the same problem, I have Sony Vegas 6, and I rip most of my dvds to .avi files on my computer. However, the codec in the .avi files is not always compatible with Vegas and this is why you don't see the video or maybe you only see the sound portion? What you need to do is convert your codec to one that works in Vegas, for me, this is DivX.
If you don't have it, it is readily available, just google it and download the components.
Next thing is: you will need the converter. Mine is called 'Avic100' - again google it and download, it takes up zip on your hard drive.
Actually having a look at it now...try "AVI 4 CC Code Changer"
In the "Four CC Description Code box : type what the original codec of the .avi file is, or there is a folder icon you can use to search for your file and it will automatically put it in for you once you select it.
In the 2nd box, Four CC Used Codec- type in the new codec that will enable you edit .avi in Vegas- for me this is Divx, I haven't tried the others that are listed but feel free to I guess. Otherwise type in "Divx" then press apply and it's done and should work in Vegas.
I hope this works for you as I had a heck of a meltdown over it and sorry for this rather long post, good luck with it!  | 
Newbie--Help importing Avi files into Vegas 6? 
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