I think what you need to do here is use the 'place animation' command to position the animation onscreen

Try using 'place animation 1, 0, 0, 500, 500', and see if you can at least see a little of it (probably at a screwed up resolution), then you'll at least know it's been loaded correctly!
When you set the animation to play, can you hear sound from your video? Assuming it has sound

Yeah, I was a bit confused over the MPEG stuff at one point :s
What they mean is .mpg format, NOT .mp4, which is a newer format that DBPro can't handle!
.mpg is (I think) quite an old format, so most things don't export to it... However, AVI is raw footage, and the file sizes tend to be quite large, so if you can find a .whatever to .mpg converter, then you might find that better

Good luck!