I've been having a lot of fun with my new DCR-DVD7 DVD Handycam Camcorder. It's great because it records directly to a mini-DVD which can be finalized and played in a regular DVD player. You can also transfer files directly from the camera to your computer. They come in as MPEG files that can be edited and manipulated by programs like Microsoft's Movie Maker. The video quality is good, but the still pictures are only 640x480. (But that doesn't really matter because I also have a Sony Mavica FD200 which takes 2 mega-pixel pictures.)
My latest creation is a short video titled "Wipeout!"
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