I would start by trying to
install the lastest drivers. XP probably has the latest drivers, but I would check to be certain.
You probably alrady have the latest version of
DV Messenger 2.
There
might be a useful hint in either the ELURA85 Instruction Manual or the Digital Video Software (Windows) Ver.15/Ver.16 Instruction Manual, both of which are available
here. I concur that neither manual is very helpful, but there are some troubleshooting steps at the end of the second manual.
Have you tried using one of the Canon-provided applications instead of Windows Movie Maker? Can those applications see the camera?
Have you tried using USB instead of FireWire? FireWire isn't even mentioned in the second manual.