According to Apple's iPad tech specs, the iPad does indeed support a type of AVI video:
* H.264 video: up to 720p, 30 frames per second, Main Profile level 3.1 with AAC-LC audio up to 160 Kbps, 48kHz, stereo audio in .m4v, .mp4, and .mov file formats;
* MPEG-4 video: up to 2.5 Mbps, 640 by 480...