Let's start with how to use
Microsoft's built-in Movie making software. They actually released a second
version of this a little while ago which considerably expanded its capabilities.
If you haven't already, download it through Windows update: Go to 'start\all
programs\windows update' and find new updates. It will be in the 'windows XP'
category.
Download and install the
update. Once that is complete, start Windows Movie Maker: "start \ all
programs \ accessories \ windows movie maker.
Click 'capture from video
device' on the left-hand menu.
Now choose the video device
that you wish to use to capture the file. Also make sure the correct sound card
is selected under 'audio device.' Raise the 'input level' slider up to about
halfway, as this represents the volume level of the captured audio. Select the
correct 'video input source' (either composite, s-video, or TV-tuner). Click
OK.