Most of the firewire cards are available with some basic software that will do several different styles of transitions. These only cost from around £30.
Microsoft Movie Maker as mentioned by mij is part of Windows XP, but is too basic in current form. The update to MM2 is a free download from MS web site and is really simple to use (used it for the first time yestureday) and you will be getting good results really quickly (unlike with Adobe Premiere which took me weeks to learn even the basics!).
Going up to around £70 you can get Pinnacle Studio 8. This is a very popular and easy to learn programme and has far more effects etc than MM2. It is a good starting point and will probably do everything you want both now and in the future.
Another well known company that make good editing programmes/hardware are Dazzle.
All the above are available from the likes of
www.dabs.com or
www.ebuyer.co.uk and many others.
Welcome to the world of video editing. From now on there just wont be enough hours in the day (like there was anyway

). Enjoy it!
Mark.