mp2 problems in XP home

I created many video clips in WindowsME (using ATI Radeon video capture),
saved in *.mp2 format.

I have replaced ME with XP Home, with Windows Media Player and Windows Movie
Maker. I also have the File Player included with the ATI Card (Multimedia
Center 7.1)

Problems:

1. Windows Movie Maker will not recognize or open the mp2 clips.

2. Windows Media Player opens them poorly. Sends for codec, then gives
'error downloading codec' message, then plays clip in distorted,
horizontally stretched form.

3. ATI File Player plays clips and they appear normal, but they cannot be
enlarged to full screen because the File Player window is 'stretched' also
and can't be re-sized.

Any ideas?