Old tapes generally means "problems ahead" in layman's terms. And to get top quality results, you can bank on needing top quality hardware. Normal VCRs will do little more than give mediocre (or worse) results.
The good news is you CAN and SHOULD be able to not only transfer the tapes, but IMPROVE THE QUALITY while you're at it. This is restoration, and is my specialty.
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The extra $100 is for a bigger RAM buffer in the DNR circuits. It does work better, but you'll have to decide if it's $100 better. I am a perfectionist, so I say yes. However, the 7000/SRV10 series units are no slouch. They do an excellent job too. Often every bit as good as the 9000 series. It's mainly tougher tapes that stress the lower RAM buffer.
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Good wires = better signal. For s-video, get the thicker wires with gold plating. For composite and RCA audio, get Monster cables that are thick and gold. For coax, get RG6 (not flimsy RG59) cable, preferably gold or even copper/silver tipped is fine here. Satellites require RG6 because of the higher bandwidth. You may be able to skate by with some RadioShack cables, but a single set of Monster really is worth it. I used to think anything would work, and I was proven wrong over and over again in self-done tests. Experience.
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DAC-100 is the DataVideo version of the Canopus ADVC DV devices. They work great, but are limited to DV only and may suffer 4:1:1 color compression artifacts in NTSC video. But is it an excellent DV AVI device.
The blip and skip as you have called it is probably a problem with poor source. You sound like you need a standalone timebase corrector (TBC). More info on these are in the PLAYBACK DEVICES guide on this site.
The ADVC-300 is not as good as it claims. Yes, it is mostly marketing fluff by one of the biggest video marketing fluffers in the business: Canopus. They re-define "smoke blowing" when it comes to their products. It works well, but it's not worth anywhere near $500. You could buy a good VCR, and TBC, and even some used proc amps and detailers for less than that (or at that). Totally senseless pricing. It sounds fancy on paper, but that's about it.
For now, I think a good VCR and TBC will solve your problems. If not, then the capture card can be looked at later. It would be the CHEAPEST thing to add/replace anyway.
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One you digitize the source, you're finished. There is almost NOTHING that can be done to fix analog video once it has gone digital. We want to fix it in analog-land before it ever hits the PC. Computer software is a last-ditch effort when analog fails.
Are you just transferring video? Not real editing (except maybe cutting/splicing footage). If so, we really should talk about DVD recorders. That will speed things up quite a bit, and analog correction is still possible. Plus it frees up the computer for footage that you DO want to edit, as well as authoring.
More RAM won't do anything for you. You likely use no more than 600MB at any given time anyway. I have tried to use RAM. I can never top 700-800MB or so. CPU is the bottle neck. Yes, Vegas 5 is supposed to be better than Vegas 4 (or so a pro I trust tells me). Reviews on it are good too. I'm an
Adobe Premiere person. Or Final Cut Pro.