Clip Channels represent clip players. The clip players are either hardware bound native players (Matrox) or a DirectShow based software player. Clips can be used either as DVE or Texture effect.
With the Clip Channel Media Asset it is possible to play images as DVE or Texture with the Matrox clip player. Supported image containers are jpg and png. The images have to be available on a physical disk for this feature to work. One advantage of an image played as a clip, is that the same features available for a video clip can be used on the image. You can see a detailed description of the functionality in the Media Asset Panel.
Note: DVE is not available with DirectShow based software players.