The First Movie is based just after the episode "It's Mr Mime Time" because in that episode we saw Mewtwo escape from TR HQ(which was also shown in the movie) and also the two episodes that followed where the two christmas episodes "Holiday Hi-Jynx" and "Snow Way Out" which included major plot problems such as Charizard been downgraded to Charmander, so i think that these where just fillers for while the movie was out, so the short answer the movie takes place where "Holday Hi-Jynx" and "Snow Way Out" are, inbetween "Its Mr Mime Time" and "Showdown at the Poke Corral".