Movies need to be MPEG 4 format (MPEG Layer 3 is MP3 a MUSIC format) It needs not only to be MPEG4 but have the correct codec and the only one it supports is the OPEN standard one of H264 (some programs try and use their own incompatible ones)
you should put it into a format the ipod does support directly or indirectly. The only Open format ipods support is the standards MPEG4 with h264 encoding. as other format require codecs to be loaded onto the operating system and this is not possible with an ipod as you can load codecs only use the pre-installed open source ones.
WMA or AVI is NOT and open format, neither is RAM, WMV or other proprietary formats. in fact AVI causes more problems than any other format there are so many type of AVI that 50% will not play without add-ons to the system some of which expose the machine to trojans. those not in MPEG4 can be converted to MPEG4 from within itunes using the 'convert for ipod' itunes under the advanced menu in itunes.
some files are too big as well or too high a bit rate. select that file if it plays in itunes then form the advanced menu select 'convert for ipod' and it will create and ipod playable version.
if you have windows components for Quicktime it is possible to load into itunes both Quicktime .mov and Unprotected windows Media WMV formats and if you have bought the quicktime pro code you can export it in quicktime format easily. if not you must use a convertor and I'd check on www.versiontracker.com for the one that suits you best.
IMPORTANT some tracks have DRM copy protection (bought form itunes as normal protected files and not the itunes + high quality unprotected ones). If the track has DRM copy protection it is not possible to convert the track, nor will it play on an unauthorised device (non ipod, or ipod not registered to a computer authorised to the account that bought the track). its illegal to try and rarely works even with illegal programs.
getting this from a DVD or other format needs you to get a convertor or RIPPER and you can get these via www.versiontracker.com
although many shareware will either overall a trial logo or limit it to 30 seconds until you pay the unlocking fee.
for the Mac I use handbrake to RIP DVD's and it does correct to MPEG4.
the reason ipods only use mpeg4 is that its the only OPEN format that does not need an extra codec loading it into the operating system.
ALSO You need to tell your ipod to sync apps, Music (or Movies etc) as by default most syncing is OFF other than Music which is ALL unless its too big for the ipod/iPhone when its none.
Plug ipod into itunes.
click on the ipods Icon its summary page appears.
click on the tab that says Video
click on 'Sync All' or ' Sync only selected'
click on APPPLY BOX
click on SYNC box.
voila it now will sync Video