What kind of computer do you have? If framerate is still low try to record at lower resolution. 1280x720 will be the 720p "HD" setting on youtube. For performance it is better to set the LFS window to the resolution you want instead of having the recording software downscale it.
I did not try Spring Free Cam 8 but its website says that it records as .wmv which I think is not so good. (means good filesize but is not lossless so each editing step further reduces quality, and the compressing during recording uses CPU)
FRAPS is good recording software imo.
For editing my facit there imo exits no good free editing software.
The newer Windows Movie Maker versions are okay-ish. (Nothing great but decent and not as horrible anymore)
Easy to use but limited. For first video I would definately recommend that one.
Lightworks is good interface is bit complex. Similiar or worse with Blender.
Personally I found avisynth fascinating but it is an unusual way to edit videos, by writing scripts.
There are also Sony Vegas, Final Cut and the other "big names" but all cost $$$.