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In the olden days, you could tell people all about your great exploits...but they didn't necessarily believe you. Today, you can easily fill your hard disk with multi-gigabyte films of your online adventures, and PlayClaw ($30, free demo) is a tool to help you do just that.
PlayClaw is very easy to install and use. Just install it, verify that the fairly straightforward setting options are what you want, make sure that the key you chose for "Start Recording" isn't the same key your game program uses for "Autorun Straight Into A Horde Of High Level Monsters" (not that I speak from experience), and you're off! Press one key to start recording and one to stop, and look in your selected video directory when you're done. You can also temporarily pause and resume recording, so you can stop for a few minutes while your entire guild mills around waiting for Leeroy Jenkins to get back, then pick up again right as he rushes into the drakes.
PlayClaw also serves to take screenshots. Since most games already do this, you may ask why this is a feature. PlayClaw takes advantage of multi-core processors so that there is a minimum of disruption of gameplay during both screen and video capture, making it a possibly better tool than the games own picture taking function. In addition, PlayClaw allows you to specify several formats to capture in; most games default to one.
Last, Play Claw will show your framerate overlaid on the screen while you play and on captured video. This feature very important either for bragging to your friends about your new overclocked box, or justifying your inability to win in an FPS game due to your ancient doorstop of a computer.
The current reigning champion of in-game video capture is FRAPS. Both have very similar functionality, overall. FRAPS has a few more options, but PlayClaw takes better advantage of multicore machines and has a function to pause and resume recording. It is also slightly cheaper. Both have free trial periods, so you can check them both out.
Note: The trial for Play Claw is unlimited in time, but you can only record 30 seconds of video and the video will be watermarked.