mp.4 buggy for editing?

Apple told us that the reason why
none of us could read the raw 1920 x 1080i @60 fps mp.4 native files was because QuickTime 7.2 is buggy so we had to go back to version 7.1.6... Which fixed the ability to read the files, but they stutter about 1/sec during playback, and the motion in frame is about 1/2 speed.
I have reviewed all the 620 clips, and have narrowed down (in anticipation of doing an
assembly/rough cut), to 320 clips. I am using a brand-new MacBook
Pro 17" with 7,200 RPM hard drive, high resolution panel connected to
a 23" HD Apple Monitor. I am also running Final Cut Studio Pro 2.

I need your thoughts:


CURRENT PROCESS:
Right now, I am:
1. Opening up the file in QT.
2. Select "Share" command (which does a great job at a decent speed
of compressing the clips into viewable files suitable for email).
3. Putting the resulting file in a separate folder.
4. Dragging the files from the folder in 3 directly to the timeline.
I plan to:
5. Create an initial edit (through to Fine- at the point of adding
the music)
6. Make notes as to which clips are used in the edit and (to some
extent) note the in and out points just like normal logging
7. Batch convert at highest resolution JUST those clips needed for
the Final Cut.
8. Bring the files created in step 7 into the timeline and create the
Final Cut.


WHAT I NEED:
How can I QUICKLY convert these gangly files (some are as large as
1.2 Gb) into viewable, non-stuttering video files that play in the
timeline smoothly so I can generate a cut-list (at least determine
how to weave the story). Remember- I don't need any audio or even a
decent visual- just to see how I want to cut. The next step would be
to convert to highest resolution just those files that I need to make
the cut. That way I don't waste any time rendering huge files I will
not use in the Final Cut.


QUESTIONS:
- Why does it seem like I am not using tools in FCP correctly or
efficiently? (as in there is some selection or checkbox I am missing
or something)
- Isn't RTExtreme supposed to do this?
- Someone suggested using the ProRes codec- what are your thoughts-
good or bad move