Camstudio is very capable of creating videos. I've used it for all of my videos. However, the way you configure the options in Camstudio matters a lot. The default setup for instance will usually result in poor quality videos.

This guy does a fairly good job of explaining the whole thing.

The way I usually work, is I capture a video with the Camstudio Lossless codec. I then open the file in Corel VideoStudio 12. (which has a lot of cool video editing features for a reasonable price) do some post processing (ie cropping, adding text), and then save the file in whatever format I need.