I have found that BSR is basically WYSIWYG (what you see is what you get), so basically if you go full screen mode on a high resolution display, the movie is quite good indeed. Also if you set Movie Maker to a high resolution mode and 24 or 30 fps (not an "optimum" setting), it extrapolates between capture frames to get the full frame rate there is essentially no flicker or other motion problem.

The main difficulty is you are now getting an additional large video file during screen capture and since Alice already has difficulty with large files, you can really degrade overall performance or crash the system. Sounds like you are doing the right thing to stay with relatively low quality.

By the way, Movie Maker (and the Mac equivalent) both have nice simple, drag and drop fades and other effects. If you are pushing Alice's memory limits, you can always add these and the sound in the movie editor.