You can export a still frame image from a video many different ways with the software that comes with your Mac. If you are already in iMovie, you can use the sharing function to export an image from the current frame in the timeline or a library clip. In Photos you can save a frame in a video to your Photos library as a picture, and you can also copy the current frame and paste it into another app. The easiest way is with QuickTime Player where you can copy the current frame and then paste it into Preview or any other app that handles images.
When getting a still frame out of iMovie, is it possible for it to be a different image format is JPG/JPEG the only possibility? I ask because JPG/JPEG is a compressed image and not always the best quality.
Douglas: That's it. Use QuickTime Player if you want something else. But keep in mind that video is compressed anyway (unless you are using pro-level special video formats) so I doubt that using jpeg or png will make much of a difference. The frame in the video is probably more compressed than the jpeg image you export.
At 1:55 in the video you are incorrect - when the photo is exported a TIFF file is created in the Pictures folder. It does not appear in the Photos app.