I need help making an overlay (mask) that looks like binoculars.  I've tried making this in the Title Tool, and can only get as far as drawing two circles.  I haven't got a clue how to replace the white color in the circles with video (on another track).  I'd rather not use an Alpha Channel, as I haven't got Photoshop, but I'm willing to try it, as long as there's step-by-step instructions for using a free program, such as The G.I.M.P. or Paint.NET.  I do prefer step-by-step instructions, as I am a novice with the program (in high school TV production class, only used it about five times, but I'm not an idiot).  Thanks, I appreciate the help to come.

OK, there are a few ways that you can do this.

The simplest is to use a circle wipe over the video.  Set up two video layers containing the same material, and drop a circle wipe effect onto each.  In the Effects tool, offset one circle slightly left and the other slightly right and adjust the softness of both for the most pleasing result.

Alternatively you can use the title tool as you've already tried to do.  The disadvantage will be that you can't easily soften the edges, which in my opinion adds to the effect.  Once you've created your title, drop it onto the timeline where you want the effect.  Step into it (use the down arrow at the top left of the timeline) and replace the fill layer with your video.  The fill layer is V2.  V1 will be empty, and V3, the mask, will be locked.  Step out (the up arrow this time) and you should have your effect.  Do not create a black background to your two circles or this won't work.

With the GIMP approach you will require an alpha channel, but this shouldn't worry you unduly.  Open GIMP and create a new graphic of the dimensions that you need.  Make sure to select Advanced Options in the New... dialogue, and under that, Transparent Background.  Using the ellipse tool (E key) select a circular area and fill it with black.  Duplicate the layer (Shift+Ctrl+D) and offset the duplicate using the Move function (M key) until you have the effect you want.  Flatten the shifted layer onto the underlying layer and deselect your ellipse (Shift+Ctrl+A).  Fine tune your centring if necessary with Move.  Apply a Gaussian blur (Filters->Blur->Gaussian Blur) to the shape to soften the edges and save the result as a PNG format file.

Import the graphic you created with GIMP into Avid, using Alpha Invert in your import options.  You can then follow the same teps to replace the fill as you would with the title effect.  Although it's more steps, the GIMP approach would be mine, although I would actually use Photoshop.  It becomes a prebuilt and portable effect that you can use across multiple projects and Avids.

And thanks to my graphic artist son for the GIMP shortcuts!

I've often done it by drawing two circles in the Animatte effect. Choose to Key In rather than Key Out. Soften as desired.

Over the years I've built a library of these masks.  Having them in graphic form means that I don't rely on the presence or absence of a given effect.  And they can even be used cross-NLE and in After Effects too.