Working with the video of camcorders such as the Sony HDR-Z1 or Z5 can produce a serious business. HD video contains four times the number of pixels that standard definition offers, and it's much more heavily compressed.
Keep in mind that you need a powerful computer with a lot of memory to deal with the extra data and compression. Pinnacle for example, recommends a minimum 2 GB of RAM and a graphics card with 512 MB of RAM for standard resolution video, although that goes up to a 16 GB of RAM and a 2 GB graphics card when working with 1080i HD video.
You can find plenty of software available that supports editing high definition videos. For example, Final Cut Pro and Premier Pro can import and edit files in HDV format.
Even though the high definition video with these types of looks great when played back on an HDTV, at the present time is there is no way store HD video on a DVD. The only way you can store HD video for playback is on Blue-ray or hard drive or the same type of media you used in your HD camcorder.
You can always play back the recorded video you have through the camcorder itself, although you shouldn't expect to be able to write it out on a DVD disc with the current available equipment and preserve its quality. If you wait it out, the Blue-ray available media is everything you need for your HD video.