Heya guys
I was just making a video in movie maker i was watching the videos from my collections folder and they were good quality but as soon as i dragged them into the timeline they became pixilated???

Any ideas how to stop this from happening or is there a particular format they need to be in (currently in .avi format)

After dragging into the timeline, right click the timeline image and select Effects...
You might have Pixilate added.

Also, try a .wmv or .mpg file. See if the same thing happens with them.