This camera shoots in a non-standard format of H.264. It sounds like Vegas cannot edit the format easily and doesn't support the audio format that your camera uses. The Kodak web site says "Edit and share videos with the included software CD". I suggest that you use the software that Kodak supplied to edit it, or at least to render the footage to a standard format that Vegas can edit.
~jr
www.johnrofrano.com
www.vasst.com