When it comes to recording the videos for Youtube using a digital camera, there is a wide variety to choose from. All you have to do is visit your local Walmart store and look for the deals available for the digital cameras. You can find many high quality digital cameras for under $150. While some of these digital cameras can record the videos in a number of formats and upload them directly to Youtube, some of them can record only in a few formats like MPG or AVI.
In order to compress and reduce the size of these formats, you should re-encode them using popular video codecs like H.264 for the video and AAC for the audio. For this you can use the open source FFmpeg media encoding tools. And if you find it difficult to work with the command line tools, then you can use myFFmpeg which is a GUI front-end for the FFmpeg tools.
Using the myFFmpeg tool, you can change the video and audio codecs and encode the media files using a large number of codecs including both the rarely used codecs and the very popular codecs. And of course, you can choose any encapsulations like MPEG-4 MP4 or Matroska MKV.
It does not come with the FFmpeg tools and you have to download the FFmpeg package yourself. After you launch myFFmpeg you have to drop the ffmpeg.exe file on the myFFmpeg window. Once the FFmpeg is setup, you can add media files to the myFFmpeg window.
You can change the output profile for each of the added files and choose both the codecs to be used and the encapsulation format that you want. These options can be further customized through the properties given in the sidebar. You can change video codec, audio codec, add subtitles, trim videos, add meta information and more.
Verdict: myFFmpeg is a nice GUI for the popular open-source FFmpeg tools and does its job with perfection. But it is not free and can be used only 10 times after which it forces you to buy the license.
You can download myFFmpeg from http://www.myffmpeg.com/.