The thing about installing DivX is that it's invisible -- you don't see an icon in your applications folder or anything. It becomes a Quicktime plug-in, so you only see it when you're using Quicktime Pro or Final Cut and you select Export --> DivX AVI. It took me a while to figure out, too. It sounds to me like you may have successfully installed it on the first try, but since it doesn't give you any obvious feedback, you wouldn't have known that. Argh, I wish I was there with you and your computer right now -- I could show you!

I still haven't made the jump to 640x480 frame size, although that might be coming in the future. So I can't advise you about that. But I get good-looking mp4s and Divx AVIs at about 25 MB, give or take, and that's enough for me.