That's what I figured, I just didn't want you to pay more for a product that does more than you need (and doesn't do it as well).
Video editing is a complex subject. Frankly, I don't feel like any of the consumer-level PC products do an adequate job. I have not used the high dollar products, or Sony Vegas, however. I do have Pinnacle Studio and Sonic myDVD (which I only got recently and haven't had the time to try). Vegas is often highly regarded, and I think they have a light version for <$100. I like PS, but it seems most people have a love/hate relationship with it. It apparently crashes a lot for some people, though I personally haven't experienced it.
I would point you to
dvdrhelp.com, which is an excellent site for all things video. You'll need a firewire card for your vidcam, which the DV version of PS provides. If your vidcam has a pass-through, then you can use it to capture VHS tapes digitally. If not, you'll have to get a video capture card (at least $50).
Anyway, I guess the short answer is that Pinnacle Studio is a mature product that will likely do everything you need. It will create DVDs, help you with capturing video, let you edit with transitions, audio overlays, etc.