With a hardware encoder you may be able to get away with a single computer. I used to do that occasionally with my Hauppauge PVR-250 and a graphics card with s-video output.
Some examples: https://forum.videohelp.com/threads/283861-VGA-to-S-video?p=1756748&viewfull=1#post1756748
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This converter solution would be okay.
The quality doesn't seem good indeed. -
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