OK, first of all when you load up the editor if it asks you to make a backup of your game database, click YES. Things often go wrong when you're editing FM and backing up will save you a lot of stress later on.
When you've done that click on the Competition button on the left-hand menu, then select the competition that you want to edit the teams for. For example, if you want to remove Man Utd from the Premiership and replace them with AC Milan, you select "English Premier Division" from the list.
Then you click on the Teams button in the left-hand menu - this shows all the teams in the division. Highlight Man Utd (or whatever team you want to swap) by clicking on the little triangle/arrow next to the name of the team.
Then click the swap button just under the list of teams. A box will appear asking you to choose what team you want to swap them with. Find the team in the list (or type the name in the box), click on the team, click the Add button.
That should be all it takes.
BTW: Some basic help with the editor can be found in "fm_data_editor_guidelines.pdf" which should be in C:\Program Files\Football Manager 2005\