Sounds like a codec issue to be honest, that's the only time I've ever had green screen myself. Try opening your files with g-spot and see if you have the codecs installed. Also, of you are using WMP, you are very likely to have this problem. See if you can open the files in VLC (Videolan player) or MPC.
Best program for converting two .avi's to one has to be WinAVI 7.6 with it's new batch conversion settings. Choose "merge to one" and set the options to 4.3Gb (one dvd) and in double-quick time, job done! Must have tried every converter under the sun, but their new release is outstanding in every respect.