Being a "basic" (& free) movie editing app, Windows Movie Maker (WMM) traditionally wants to work with the two native Windows video formats: WMV and AVI. GoPro cameras shoot in highly compressed H.264 MP4 format. The newest WMM 2012 edition, which you probably have since you are using Win7, can handle H.264/MPEG-4 AVC video but the "horsepower" of your PC might not handle the needed decompression very well, especially if you are trying to edit on a laptop.
GoPro uses the Cineform codecs to handle their video (and now owns the Cineform company) and lets you download their Cineform Studio editing tools to make handling your GoPro footage easier.
One thing you might try is to use brorsoft video converter to transcode your MP4 footage into Cineform AVI, which is easier to edit with. See: