If your video source is VHS, you will need the following:
S-video VCR: I use a JVC HR-S5912U, (about $240). I have had favorable results with this machine. I highly recommend that, if you get one, also shell out about $10 for a professional head cleaning tape. My original machine was destroyed by poor quality dollar store head cleaners.
Video capture card: I use an ATI TV Wonder Pro. ATI has since been purchased by Intel, so there's probably an equivelent or better one out now. The capture card is a piece of hardware that needs to be installled in your computer box. It comes with its' own software. The video file player is a big improvement over any other one I've used. About $100 a few years ago
Audio capture card: I use SoundBlaster Live!, also installed hardware.
The hardware components were chosen and installed by my geeks at Computronic. I just told them what I wanted to do, and they put them in, so about $250 for the pair, including installation.
If you have Windows XP, you can do what you want to do with MovieMaker, but there are many better programs available on P2P.
