Is there anything wrong with using VirtualDub2?
 

I'm using a Pinnacle 510-USB and Virtualdub versions 1.9x and 1.10x never showed the preview or overlay displays (at one point 1.9 worked but I set the colorspace to something different accidentally and the display disappeared and did not reappear after reinstalling, restarting, resetting the colorspace, etc).

Weirdly enough Virtualdub would still record the VHS tape perfectly (when played through VLC media player), the video just would not display within the program.

Anyways...
Virtualdub2 on the other hand works perfectly for me, however I'm not quite sure how everyone else feels about Virtualdub2.

I'm using VD2 as well, never had an issue, I alternated at first between 1 and 2 because I read here(or somewhere, don't remember) that 2 have issues but I never came across something that I couldn't do or that wasn't working on 2 that I could do on 1, so maybe that recommendation is old and not updated.

With VirtualDub2 I can save a video directly to MP4 after edit + filters, something I can't do with 1, that saves me the time of a full conversion to MP4 in a different software like handbreak after editing + filters in VD, so until I'll come across of something buggy or some missing feature I'm sticking with 2.

1.9.x was safe.
1.10.x had odd issues. 1.10.x has quite a few issues with filters, too.

VirtualDub2 is a fork. It's not better/newer, there is no "VirtualDub1".
VD2 is based on 1.10.x
VS2 was created for opening/encoding to more formats, not capturing.
VD2 has all the same issues as 1.10.x

If you've not run into issues, either you're lucky, or you've simply not noticed the issues (yet).

Or that they fixed these issues since the last time you tried using it or for what I'm using it, these issues are not relevant..

Well, again, the reason for VirtualDub2 (formerly VirtualDub FilterMod) was for input/output formats. The base of the fork is 1.10.x, and hasn't been updated in years. I've not seen any relevant fixes to the capture/filter with VD2 updates.

I do really wish 1.10.x and/or VD2 didn't have issues. But it's not the case.

For quite a while now, I've wanted to submit bugs to the VD2 developers, but simply have not had time. There is also some weirdness in trying to recreate issues on multiple test systems. Not unusual, however, just makes troubleshooting and bugfix reports harder.

It is what it is. Again, for safest experience, 1.9.x is best for capture or restoration.

VD2 is mostly good to pre-extract new/weird formats to AVI, then 1.9.x from there. 1.10.x is useless.