The picture is in black and white? But the link is for color...?
I used a 2.4GHz Swan wireless camera/transmitter plus receiver that I saw on sale at Home Depot. As I recall it was $60-80 - defintely less than $100. I have it set up to drive the camera/transmitter from my 3S lipoly pack directly by using a LM317 chip ($2 from Radio Shack).
I'm not sure that I can help you much. My Swann 2.4GHz doesn't get hot... the picture is color and is pretty good, not "wow that's amazing!" good but definitely good enough to make decent moves. It's generally crisp and when I lose the signal, it doesn't get fuzzy... it just disappears (fuzzy might have been better than . About the only really bad thing that I have is that the auto white balance is a bit slow and so if you don't hold the plane steady, the white balance lags and then you have the screen go very white and very dark. But if you are slow with your movements (lots of expo given the throws on my planes) then it works well enough.
You do not need to spend lots of money, but generally the more you spend the better things get. I'm content enough with the quality of what I had - the glasses were half-resolution and the range of the system was not as much as I'd liked. But I could boost those with antenna improvements... I guess you have to decide how much you want to do this, and how much quality you want. If you want a really nice signal with great range then you'll need to drop several hundred dollars at a place like Black Widow A/V (
http://www.blackwidowav.com/). If you want something that's fun to mess around with at a park, a 2.4GHz Swann setup from Home Depot works ok... although I had to switch back to my 72MHz R/C transmitter to get it to work.
As far as the problems you are having... I have few ideas. You could try talking to the store you bought it from. You could try a lower voltage. As you wrote it, it sounds like it's overheating. Put a heatsink on the transmitter? Try 5V or 7.2V instead of 9V? Still, it if was me, I'd be talking to the guy that I bought it from.