Slightly OT: Windows Movie Maker Question

I've been having a bit of trouble with movie maker... well, what I'm trying to do is record video with WMM and record audio with Audacity at the same time. Then I export the audio file to mp3 and add it over the WMM video. I can do that without any problems. However, if I want to overdub multiple instruments, and then stick in little clips of me recording, say, the bass track, in the middle of the video (in sync with the video), and then cut back to the original video (picking up from the point in the song where the shot of the bass ends), can that be done on Windows Movie Maker? Any tips on doing so? All the audio I would have on one file overdubbing the whole video, so that part is easy enough, but I'm just trying to figure that out with the video. Let's face it, Windows Movie Maker is pretty dumb compared to iMovie, and I am eternally jealous of Mac users who churn out YouTube vids like it's nothing.

Incidentally, is there any cheap or free movie-making software out there for windows that is anywhere near as good as iMovie, or at least better than Windows Movie Maker? What do you Windows users use?