I'm dragging .mov files from the Apple PHOTOS app and jAlbum is converting them to .jpg files. Is there a video setting within the Story skin that allows videos?
This is not a skin issue. The skin plays no role in how images and videos are stored or processed. Almost all current skins support videos, without any settings changes. The jAlbum core converts the video to an MP4. It also produces a large JPG, for use as a poster image for the video frame in the browser, along with a thumbnail JPG.
The problem is Apple Photos. It doesn't support "drag and drop" into other applications. You have to "export" the video from Photos before you can add it to a jAlbum project: in Photos, File > Export.