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I'm not quite sure what you mean exactly by "transfer itunes movies" - do you mean convert movies that you normally access through iTunes, or specifically convert movies purchased through iTunes? Or are you talking about drag and drop?
I'm on 10.4.11 and use Handbrake to rip DVDs for Droid. You can also try running your files through iSquint (formatted for ipod, but look fine on Droid).
To transfer the movies, I USB mount the Droid and just drag the files into a "Video" folder on my SD card. Then play them via Gallery.