I'll be real general for now, not much time at the moment. I'll be more detailed if you need it, though:
Movie cutscenes (using the in-game graphics
1. Create an event that triggers at the appropriate time (when you enter a room, when you grab treasure, whatever)
2. Use the Move Event commands within the event to move the main character around the screen, and the message command to have text appear.
3. Repeat until you're finished, then deactivate the event.
Movie Cutscenes (using FMV):
1. Import your movie file.
2. Use the Play Movie command (Page 3), setting the movie to where you need it to appear.
AVI Movies:
Not sure of any programs, probably Windows Movie Maker. I'll check up on it after class.
Battle System:
Yes, you can build your own system, but it's rather complicated. You really can't alter the given one much, however.
Order to make things:
By quests, usually. Sidequests first, then main quest.