How to do video downloads?

Sorry if this has been answered, I would think others would need direction with this too, but I couldn't find anything.

I'm thrilled that I as a total website builder-beginner have been able to get my zen-cart up and running and looking great. But I need some very basic instructions on how to do this (since I'm pretty clueless when it comes to this.)

I need to offer a free video download that's about an hour long. I only want registered users to be able to access it. Streamed video is preferable, I think, but not if it's lots more difficult. Currently I have the video on DVD.

What format do I need it to be in (and how do it I get it there?) I'm assuming either .wmv or .flv are probably the most common. Do I need a player on my website? or is it easier to allow a windows media player file download and have them watch it on their own computer?

Thanks for any very specific instructions you can give me!

Video compression is not as easy some would hope for.
First thing you need to know , is how much bandwidth you have.
How fast the server you are hosting your video is .

if you want to stream your video , chance are that you may need Communication server .. or media server , as those server can figure clients bandwidth and transfer the stream according to their computer. ( this is optional )

what would be the quality that you want to offer your clients , ? ( dvd quality , CD, quality or something lower resolution )

if you like to offer very good quality stream or download . you need to start with very high quality video .

you have to know if your movie has lots of action or is talking head . that means either camera and scenes changes fast or not .

then you have to figure , the bitrates, key frames and frame size that you need to use to convert .

there are more , but some program either offer those and some don't .

There are tons of compression tools out there on the net . once you know what format you want to go , you can look for the right tools .
majority of those tools can convert your video without you setting anything and will give decent quality .. and again , all depends on file size , bandwidth issues , etc etc.. that pushing people to create very low resolution video on the net .

i suggest to start by reading about compression and how things works and download few demo tools and give them a try.