Just some tidbits I am adding concerning Vegas and VirtualDub, and some things I had to set to get rid of the smoothing blurred crap Vegas was doing on my videos during its deinterlacing process.
Results before adjustments:
Results after adjustments:
VirtualDub:1. Make sure to install the Lagarith codec prior to running.
2. Set compression to Lagarith, with multithreading enabled in configure on Lagarith.
3. On "capture pin" set output size to 640x480 and color space to UYVY.
4. On audio don't check "Enable Audio Playback", because it eats up more cpu resources during capping, but do enable "Audio Capture" and "Volume Meter". Volume meter will confirm you have audio fed in correctly.
5. On "Video", go to "Filter Chain" and "Filter List", then add "Deinterlace". Once added klik on it and set to "Blend fields" and on the field order set "Keep Top Field" After that go back to "Filter Chain and check "Enable".
6. Then go to file and choose "set capture file". This is where you will name your video clip you will be capping. After that you can go to "Capture" and klik "Capture Video" when you are ready to start, and when you are done klik "Stop Capture".
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Sony Vegas: To help prevent the interpolation blur mess from happening in your gameplay video you can go to "File", select "Properties", set "Full-resolution rendering quality" to best, then set "Deinterlace method" to none (make sure you had something else do the deinterlacing to the video clips prior at capping). Choose what ever you want to render as, but what I choose is Windows Media Video V11 @ 6Mbps HD 720-30p.
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Last video I am submitting. I could probably tinker around with some better deinterlacing methods a tad more but not worth the time given what I got is already perfectly fine for general viewing (and that some methods can add extremely long times to the rendering process, not worth it for gameplay videos). This is the end result of the above settings:
https://www.youtube.com/watch?v=Hvh3G8BA19g&feature=youtu.bepreview pics from the video:
Extra thanks to Eric/Quoth09, who suggested VirtualDub, etc, and for being an all-round knowledge pool concerning this stuff.