the cheapest way is to get something like a hauppauge tv card for like £25. u can just plug the vcr through the RF input on the card, as if it was a tv. then the card can capture straight onto ur pc. in fact if u hav winxp, the movie maker which comes with it is really useful. ive been playing around with, u can basically alter the resolutions and shit much easier than with hauppauges tools, and plus edit it into a simple timeline. not many features in the movie maker, but its very simple to use.
if u hav a RF in or standard aerial input (same thing) then u might already be able to do this.
if u wanna edit on ur pc using an analogue video camera, u need a capture card, u can get reasonably cheap ones like the ones made by Dazzle.
if u wanna edit on ur pc using a digital video camera/camcorder (it should have a DV port for firewire connection) u simply need a firewire card. these can be found cheaper than the tv card, plus ull need a firewire lead. then all u need is the movie maker bundled with xp. or im sure there are downloadable movie makers that are basic and simple to use if u havent got winxp.