With what video editing software are you importing this digital video with? For instance, if you were to use Windows Movie Maker (which comes with Windows XP) or Adobe Premiere, which I personally have used plenty of times, there are plenty of options available to make the file as small as possible and have it still look good.
For instance, I used Adobe Premiere Pro to capture my "Purple Haze
" video in DVAVI format which is a VERY large file, but then I exported it as windows media (.wmv) using the WM9 NTSC 1024K compression codec provided with the program. With this program, you can export it in almost any format ranging from Divx (.avi) files to Quicktime (.mov) files to DVD quality at almost any setting ranging from low quality, small files to high quality, large files.
You WILL need to use one of the available codecs in your video editing software to compress these files down though...if you want to share them, there is no way around that. Adding compression when you export the files is the key...