You can always use mpegstreamclip, which will allow you to set in and out points for a conversion, so set the first region of time and export it (either to a different container and codec, or back to another AVI although I'm pretty sure you don't have XviD as an option for a codec so if your original is XviD you may want to choose a different container and codec), then set the next region of time and export that and repeat until you're at the end of the movie.
Or you can convert it to an mp4 or a mov and use iMovie to create short movies of the regions as your "chapters" then export it.
Or if you want one giant file instead of multiple smaller files, you can use Handbrake and convert the AVI into an MKV file, then use mkvmerge and make your own chapter entries.