Capture - what's the best way?

[su]

Hi!
I'm trying to convert my DV Cam films to VCD; I tried many thinks but I haven't good results and now I'm thinking that the problem is with the capture.
I capture the DV Cam films through a firewire and using MGI VideoWave III software. What's the best software to capture? Does anyone know this software?
When I capture the film, it creates a AVI file and when I see that AVI file in WINDOWS MEDIA PLAYER (full screen) the quality is awful; this is normal?

Thanks,
Su

[vcdfreak]

The capture quality should look almost like you view from your LCD screen of your cam (maybe a bit darker and duller on color) if you are using the firewire.

I use Windows Movie Maker that comes with WinXP/WinME (remember to set to Other types->DV-AVI, uncheck the create clips option to save bunch of nonsensical time).

What is your standard of being awful? Noises? Dropped frames? Interlace noises? Poor low-light performance?

Please elaborate.