I'd recommend Vegas to just about anyone who asks - Its easy to learn and use and very robust - lots of output formats - a good program all around...
Carrie - movie studios still use film cameras. alway will, IMO - you just get more flexibility with a panavison or arri setup for shooting a movie. Digital IS there, but only Lucas can afford the cameras! As soon as its shot, however, its digitized - dailies are viewed and editing (digitally) begins - I was in the industry for a very short time and there was a concern early on about digital replacing film, but digital is so integrated into the process now that its no longer an issue!
for smaller scale production - and "direct to TV" or internet type stuff digital is a boon - film-like results (with a little processing) and MUCH lower cost!