Start by reading this, concerning 1-hour DVDs: http://www.digitalfaq.com/forum/vide...mode-best.html
This is true: USB devices available on eBay
generally offer very limited quality captures.
Most of them are the same fake/knockoff junk from China, and the quality is horrid. That's assuming you can get it to work, as most do not.
If you want to capture AVI, and then later compress to MPEG on your own, then the ATI 600 cards capture PAL AVI perfectly, even though it's marketed as an NTSC-only device. I use it quite a bit to capture PAL AVI files. It just doesn't capture PAL MPEG. But if you're converting the AVI to MPEG on your own, this doesn't matter, plus the slow-encoded MPEG may be better quality if you're transferring shaky home movies.
Get it here: http://www.amazon.com/gp/product/B00...SIN=B00138EOH8
It could also be argued that 3 HQ DVDs is still less space than a single VHS tape. The concern should be on quality, not cramming as much as possible on a disc. Although, as mentioned, you can easily get 3 hours of quality Half D1 (352x576) on DVD, and it should look at least as good as the original VHS tape -- especially if you filter it with a good VCR, or good post-processing methods in Avisynth or VirtualDub
List of suggested VCRs here: http://www.digitalfaq.com/forum/vide...ing-guide.html
More on TBCs here: http://www.digitalfaq.com/forum/vide...time-base.html
If you need anything else, post a reply here. (Not more PMs.) Thanks.