Now, first disclaimer:
I don't use iMovie for what I do. I've launched it like 4 times, 3 of those times on my Mac Pro to see what it was like before getting FC, and once on my mac mini so I could see what changed between '08 and '09.
I don't know how advanced the output capability is of iMovie, but if it were me, I'd:
1) Output mp4 w/ .h264
2) Adjust resolution to something reasonable - 1080i or 720p gets a bit big
You may have to play with the size to find ideal, you may want to try your video at 1/2 or 1/4 resolution
3) Fiddle with your bitrate depending on your target audience. If people are going to be on lower end high speed, or dialup you're going to need a lower bitrate to make the streaming reasonable otherwise they'll be spending a lot of time buffering. A 4000kbps bit rate may yield an awesome video, but the file size will be large for longer videos. Try between 1000kbps and 1500kbps and see how it looks.
Like I mentioned, I really don't use imovie, so I don't know what kind of settings you have on your export; worse case scenario, you can output it in a best format and then use another tool to convert the video to a convenient streaming format like mp4 or flv (for use with a flash player).