With DVD video you have files called VOB (video object files)
The key then is simply getting the VOB file in a format iMovie will import. Its actually very simple. You just need to make a disk image (.dmg). Heres how.
1. Insert your DVD
2. Open the Disk Utility (Applications/Utilities/Disk Utility)
3. Your DVD should show up in the upper left hand corner under yo other drives (HDD, any external, etc.)
4. Highlight it and choose New Image from the toolbar.
5. I used the default settings in the drop down and save it to the desktop (or wherever you choose)
6. Click SAVE.
Let Disk Utility chew on that a few minutes and presto-chango you have a disk image (.dmg) of your DVD.
Now, with iMovie open, you have to mount the disk image by double-clicking on the .dmg file (the disk image file) you created.
Next iMovies IMPORT window will pop-up and you will notice that the disk image is recognized as
.a camera! How about that.
Now choose IMPORT ALL and get to editing once it is in iMovie. Thats it!
This solution is originated from
http://www.mango-design.net/2009/04/importing-dvd-videos-into-imovie-macbook-pro/