That’s because Vegas is expecting to see a firewire (1394a) connection. That means your PC has to have a firewire card or connector installed. From what I can determine, the Dazzle DVC accepts RCA & S-video inputs, but outputs only via USB, hence why Vegas does not recognise it as a device as such.
If you do have a firewire card and an old DV video camera that accepts an RCA (analog) input and has a firewire connector output (both on the camera body), you can use the camera as a ‘pass-through’ device to convert the analogue input signal from a VCR to a digital video signal via the firewire connection. Vegas will recognise the camera in this case, and all you will need to do is start the VCR, and when you see the video appear in the capture preview window, you can manually start (record) the video stream in Vegas. This method will give you the best possible capture quality. You don’t need to have tape in the camera, and you can record long VHS tapes this way.
Note that some DV cameras that have an analogue input don’t permit pass-through, but all that means is you record to DV tape first ‘in camera’, rewind when you are done, and then playback and capture in Vegas. You are limited to 83 minutes (if you are using Panasonic 83 minute tapes). You might be able to use long play recording on the camera, but that reduces the bit rate and thus, quality.
If you don’t have a firewire connection to do a passthrough, the DVC100 is your best option, but that means you have to use Pinnacle to ‘capture’. If you have an option to capture as AVI, choose that, but be aware it is around 11 GB per hour of video. You can capture as MPEG2, and I would avoid MPEG1.
My system specs: Intel i7 970, 12GB RAM, ASUS P6T, Vegas Pro 12 (x64), Windows 7 x64 Ultimate, Vegas Production Assistant 1.0, VASST Ultimate S Pro 4.1, Neat Video Pro 2.6