Ok, to simply grap the video:
-In camstudio, under 'Region' select either Region to be able to draw the desired box around the area of video you want or "Fixed Region" and set it to the size you know you're going to use.
-Under Options, I have "do not record Audio"; in Video Options - i have Microsoft Video 1 (i use that b/c lately i've been dropping them straight into ImageReady to make some animated .gifs or dropping into virtualdub to edit and compress. but select whichever encoding you want).
-still under Video options I have, Quality at 90 and Auto Adjust checked (where it adjusts to Set Key frames every 50, capture frames every 20milli, playback rate 50 fps).
-open your .mov or whatever video, but don't play yet or cue it up to where you want to start recording.
-hit the red button on the camstudio window. if you had it set to region, it will begin recording once you've drawn the region; if you had a fixed region, then it will begin recording once you've "set it down"
-stop recording with the blue button (or F9 is the default i think)
now...if the video didn't record, let me know as there might be an overlay issue (there's a workaround but let's see first)