I am running Fedora Core 3
Using MPLAYER (Latest Version)

When trying to play AVI's (locally) I keep getting the error: FATAL: Could not initialize video filters (-vf) or video output (-vo)

I have a 128 meg GEFORCE FX 5200 Video card. Which is configured correctly.

Any Ideas???

It may be the avi files rather than MPlayer. Not to up on these things but avi is just a container not a strict file type as such. My system is Suse and I use MPlayer - some avi files play OK others go nowhere.

I get the same error when I try MPEGs... and I have downloaded about 20 Avi's and none of them work.

You may have already done this but do you have all the latest codecs installed? And did you install them before you compiled mplayer? You can also compile mplayer with debug output to see where the problem is.

I haven't had any luck trying to install mplayer from .rpm using Fedora. Some may disagree. Mplayer compiled from source works fine. Just my opinion.
Mplayer 1.0 pre6 was the first version that I could get to play streaming .wmv, .mov correctly all the time without problems. Put the codecs where the instructs tell you to then compile.

Also sometimes if you have a GUI file manager or browser open when you launch mplayer it will cause a video error.

I don't understand Linux altogether yet. I notice a bug or two every now and then. You can usually find a work around it. Still better than using Microsoft. After you get something working in Linux you will know why and how.