Not neccessarily. If you have a SATA drive you should be able to record full size 1024 atleast with no problems, I've done it(I remember I could record at 30fps atleast, no problem). Before that I was playing around with 1280 at half size recording (640) and it chugged at less than 15 fps. It all depends on what the bottleneck on your system is, and at what fps you are recording at. I've got an Athlon XP 3000+, and was recording to a SATA drive.
A generator went out, and the building that hosts my web site had it's power shut down, so it may be a while before the videos are back up. In the meantime you should be able to find some sample HC1 videos here:
first off, i would suggest xvid, as i think its slightly better than divx.
and very important: resolution is not THAT important, its much more about vbr/cbr and the little tiny side-details, with which you can gain max details on min filesize