i am digitising from friend's old home movies (from VHS tape). the sound quality, however diminishes (ok, a little can be expected, BUT) it sounds like there's been an non-echo echo (like when you stand in a big stone cathedral, your voice is "bigger") added on top of a little extra volume, which is what distorts the sound.
it can make it hard to understand some of the spoken bits, while playing the VHS (even through the computer in the same setup as when capturing) the sound is normal.
I am using Nero 6 (Nero Vision Express) on XP SP2 to capture. i have a capture card (not sure of brand) but cannot capture sound from it directly (in settings) b/c it adds a feedback echo (every second replays the previous second audio on top of currently capturing audio in a "grand canyon" kind of effect) so i use the built-in sound card (RealTek, i believe). this is ok, but still adds that volume and the non-echo i was talking about.
i also have a vista laptop with s-video plug - is this worth a try?