An easy one!

If in fact you have a mini DV digital video camera, for high quality transfer, you MUST use Firewire (called i-Link on some cameras -- check your camera's Manual.) And you should be doing it using the DV/AVI format, not DVD/mpeg-2 settings. The problem is that no camera manufacturer of which I am aware includes a Firewire cable with the camera, but they usually include a USB cable. This gives users the wrong impression that they use USB for the connection.
And you certainly don't need to use a capture card for DV. A direct Panasonic - computer firewire link is all that's necessary, because you are not in fact capturing but merely transferring the contents of the DV tape (which, as its name suggests, is already in the DV format) to your computer in the same format.
Trying to capture DVD format from a DV camera imposes an extra burden on the processing power of your computer. More often than not, the latter can't quite handle the speed and volume of the incoming signal -- which is sent from the camera in DV format but you are asking the computer to convert it and compress it on the fly. So the computer pauses for a fraction of a second while what is called the transcode buffer is processed and emptied out, then the capture starts again. That would probably account for the dropped frame/jerkiness you are noticing.
Of course, your computer must have a Firewire connection. But if it doesn't, then Firewire cards are cheap these days, and usually come with a connecting cable as well. With regard to the latter, make sure you get a cable with the right plugs at either end -- normally it is a small 4 pin one at the camera end and a larger 6 pin one at the computer end.
Believe me, it will make all the difference.
