There are units that you can put between a vcr and a dvd recorder to help with macrovision problems, which aren't all that expensive. Only problem is that you will be limited to capturing in MPEG which while editable, has limitations.
Or, you can purchase a capture device which will allow you to bypass macrovision, and will capture in multiple formats. There are various devices, some of which will capture avi, mpeg1, mpeg2, divx, and others. It all depends on what all you need to do. One thing to be aware of, is if the device locks the audio to the video during capture. If it doesn't, in many cases, you will have audio that is out of sync with the video. Some people have a lot of problems with this, and some seem to have very little problems.
I do a small amount of work for actual customers, so I use an ADS PYRO AV/Link for capturing old VHS stuff, or to go from an edited dv-avi file, to creating a vhs output. For stuff like simple capture from a video camera to avi or dv-avi, I just use an ADS Firewire card which I got for $18.00. I haven't had any problems with that.
Some folks like the Hauppage 250, 350, and 500 cards for capture. Whatever method you choose to use, just make sure that you follow the recommendations for that device (usually which includes having two seperate HD's with one for software, and one just for data/video), keep the drives defragged, and if your machine isn't powerful enough, you may have to shutdown some processes to ensure a quality capture.-