It's worth adding to this that MPEGs (1, 2 and 4) as well as AVI, and in fact ANY other formats (there are so many, including Quicktimes MOV, Windows media etc etc) all use different compression algorithms and generally you will find programs to convert from one to another (such as FLASK to change MPEG2 into others). However, in terms of quality, ALL of them including native DV (usually the 'original' in terms of video editing) are compressed in one form or another (DV being i guess the least compressed). What counts in many ways is the bit-rate. You can make MPEG 1 with very very high bit rate that looks spectacular, but won't conform to a STANDARD (ie usually MPEG1 is for Video CD, which needs about 1150 kbits per second for the video element). So, what i'm saying here, is that AVI as such doesn't have any particualr quality in itself. That's like asking how fast does a car drive at. AVI can be very good (with high bit rate) or very poor (low bit rate). Converting from one format to another will also surely lose even more quality.
Hope this helps, and didn't sound TOO much like a sermon.