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You can combine the .avi's into one file using Quicktime, then run it through Handbrake.
 
Or you can convert avi series with Handbrake and then merge them with MKV Tools. Otherwise, yes, you would need QT7 Pro.
 
I know QT Pro version can convert avi to mp4, but it can't combine 2 files to 1. I remember that I downloaded Leawo free iPod video converter before, it allows me add different type of videos together and merge them into one file. But the free version has some functions limited, so I upgrade to the pro version.
 
If they're DivX or XviD you'll have to run them through Handbrake first.

For free solutions, you can use MPEG Streamclip or MKVTools to combine them after that.
 
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