I haven't installed any PVR software in awhile (haven't gotten into the whole recording shows on the PC, when I have a VCR sitting around.... but I regress).
Although I have some software that I would use (looked into this not too long ago). I narrowed it down to two:
Showshifter 2- records directly to Divx (have to have the Divx codecs installed first)
WinDVR 3 - records to MPEG 2, but allows you to display the movie as part of your desktop (doesn't cover your icons)
Haven't really used either one, so I couldn't recommend one over the other...
My two cents..