Tim, I think the main thing to remember is that the less compression you can do at capture time, the better your end result will be. If you're not going to edit anything, it's fine to capture straight to MPEG but if you're going to edit, you want the highest quality source available. Simply put, capture whatever format makes the biggest files, up to the maximum resolution of the original source, i.e. there no need to capture from Hi8 at 720x480 or something like that (I don't even know if that's an option).
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