Editing Quality

Hi,
I have just read a very short article in a video camera magazine and I am a little perplexed.

The article stated not to edit mpeg video as you end up with a loss of quality, is this true? It said to edit in avi format, the article said that Adobe Premier will not allow you to edit mpeg files, you can put them in the timeline but it will crash and keep on crashing if you try and edit the mpeg, but with the new digital cameras I believe that they stream mpeg to your HDD.

Also, I have a Hitachi DV Cam and it uses DVD Ram (also CD-r minis) the file it creates on the DVD Ram is a VR file, whats the difference with a VR file as opposed to mpeg files.

Any thoughts would be appreciated.

M