Larry is right on point working backwards. I have no experience with Dazzle but do burn DVD movies.

I input my vhs through a camcorder that can convert to avi and input via firewire. This works rather well. Software makes a huge difference in editing and authoring. Two of the more popular are Adobe Premiere Elements and Pinnacle Studio 9 (there are others of course). Each of these are available as free trial downloads.

Working on video can be extremely taxing on a PC. Rendering can take many hours.