The USB port on my SV550XVT is only used for service updates and the user manual states not to try and use it for anything else. What is the label on the USB port on your SV320XVT? Are you sure you have a SV320XVT and not a SV321XVT?
avi is just the container for the video file. that container can use many different codecs to encode the video. its likely that codec isnt recognized. download MediaInfo (it's free) and that will tell you what codec its using.