I have a somewhat similar issue.
I connected my Panasonic DMR-EZ48V (VHS/DVD player) to my computer via the Roxio Video Capture device, using S-Video (as per instructions in the Getting Started Guide).
When I try to record, the video is fine but there is no audio.
Worse than that, the device starts acting like a microphone and plays back (thru my computer speakers) any noise that I make.
And it's VERY noisy !!!
Is there something that I've done wrong ???
(I previously tried the white-yellow-red connection method, but no audio with it either.)
Thanks for any help or direction you can give me.