Mitcherooney does point out good information.
Now if you did a default profile, without any changes, you should have ended up with an mp4 that has a single audio track out of handbrake that should be supported. I can't comment on earlier versions, but I know on iMovie '08, I took a file I exported with handbrake 0.94 to a mp4, default config (ie: not adding additional audio tracks or subtitles, etc.) it imported into iMovie just fine, plus the file wasn't grayed out.
What version of iMovie are you using? I kind of assumed you were using '08 or '09 which was a mistake (I should have asked earlier) but if it is '08 or '09 it shouldn't gray out a file with extension .mp4 - even if it will fail on the import (ie: an mp4 with an unsupported profile/config), it should show a .mp4 file as possible to import, and the default setting on handbrake 0.94 does import into iMovie '08 (and should work on '09 as well) without a problem (obviously assuming you selected mp4 and didn't fiddle with the settings. You could try, on the settings panel, selecting Apple -> Universal and see if that works. I did test that setting as well, and it created an mp4 that I was able to import as well.