To be honest, VHS doesn't start to be transparent to the tape (lacking most all artifacts) until you get into the 15mbps range -- Blu-ray spec MPEG-2, not DVD (which had a max of 9.8 to 10.08, depending on the audio).
ATI CMC has a manual bitrate setting -- you don't have to use that good/better/best, and I don't suggest it at all. You can set ATI CMC to capture up to 15mbps, like ATI MMC. In fact, ATI AIW cards tend to encode M{EG better, as the cards are hardware-assisted encoding, whereas the ATI 600 is software only encode (though made only for those ATI 600/650 chipsets).
I know this is an older post, but I'm curious where you're at with all this. At the time, I just wasn't well enough to participate much online yet. I glanced at the VH post, but it's lnog-winded, and meanders a bit over numerous subjects.
FYI: sanlyn is a valued member of this site. So he's here, if you want his input again.
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