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You need VHS player and some analog tv card with s-video input and some cables. Most TV Cards will do avi, but if you need DVD/mpeg my advice is to buy video card with hardware MPEG-2 encoder (they are bit expensive then usual ones but it will pay off soon) since it does all encoding itself and it doesn't use CPU so chances of dropped frames are minimal. Leadtek PVR series should do the job.
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