vcize:What did you use to capture the video?
I use the Blackmagic Intensity (here is a link to the Intensity Pro, it appears the regular Intensity product which only has HDMI has been discontinued). The setup is HDMI from 360 to an HDMI splitter - one to the TV, the other to the Intensity card in a PC. The card supports 1080i, but I play/capture in 720p so I don't have to deal with interlacing (and my eyes are not good enough to notice a difference between 1080p/1080i/720p
).
I went with the Intensity because I did not want to give up HDMI or switch cables to capture. This setup is completely transparent. If I want to capture, I just go the PC and start the capture. I didn't know of any other way with HDMI at the time, and there may be better/cheaper ways to do it now.
I capture and save off the individual clips with VirtualDub, then make the video in Sony Vegas 9 Movie Studio. I used to render the final video from Vegas in WMV format, but for this one I tried something different. I rendered the video from Vegas in an uncompressed, AVI format. Then used MeGUI to encode it in using x264 (YouTube likes this better, imo).