Not sure if you are still checking this thread but the second one looks better than the first.
As for improving the picture quality of your captured video you would be better off having a clean capture of the native output of the device and doing software processing to try clean up the image. I say try because there is only so much you can do with older video and conversions. Not sure what you are using for capture,edit,and burning software but some programs allow for de-noising video, de-interlacing, and general color fixes. This does take time for the video to process but you can achieve "cleaner" video than you started out with.