HAGAR08  I don't know what the confusion is: the tool clearly states it imports videos in iTunes. ALL videos. And that's what it does. And it does a great job at it.

For iPod, iPhone and AppleTV: it is clear that if you have a video in an incompatible format in iTunes, you need to convert it first. That will ALWAYS be like this, with any approach, as those devices CANNOT play anything else (except when you hack appleTV).

I don't see the problem: it's all clearly explained at their site:

VideoDrive FAQ   
(Version 1.4.3)