Problem:
iMovie will not import a file over 2 gigabytes in length or about 9 minutes. (Error -40) What the exact details are in this phemomenon goes back to disk limitations that used to exist on older file systems that had a 2 gigabyte limit. (I would suspect that Apple would address this in the near future)
Solution:
In the mean time Oak Street Software has been kind enough to provide us with scripts, for both OS X and OS 9, that will split your DV stream in nice 2 gigabyte chunks so you can import them into iMovie.