As mentioned already avi is a container. Theres many, many codecs it can use.
Cinepak is probably the best compromise between speed and compression for slower hardware and can produce some decent results.
There's other options that give still better results on slow cpus, but the a1200's slow ide controller is a bottleneck so avoid them unless you use something like a fastata.
Also, make sure you have ks in fast ram as it makes a surprising difference in playback speed (especially with froggerng).