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I use a program called Vegas (Sony Vegas).
You would simply load the video into the application, split at the beginning and end points of the clip you are looking for and throw everything else out.
Then you would resize the frame so that it would be just around the portion of the video you want (the talking head).
I'm not in front of my computer at home at the moment, but Vegas may have an export to .gif function.
If not, then personally I would "render stills" from the individual frames; batch process them in Photoshop to be the correct size and then use a .gif animator to create the avatar.
I'm not sure if MovieMaker or iMovie have any of these capabilities.
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