Well that was a nice screen capture that did not show what I wanted to see. Did you select the video and drag it down to the timeline? I didn't see that you did. It does take some time. With 4:3 and VHS type input, you do not need shadow files unless your computer is woefully underpowered.
I would have liked to see a short section of the original capture. Do you have one available? I want it raw from the capture and not from being edited anywhere.
I did not see the green progress bar Are you sure you don't have the shadow files activated? If so, the bar has to go all the way before you will see anyything on the timeline.
Using Windows, If you right click on one of the files and go to details, can you post a screen shot of that?
What device are you using to do the capture. Most will do mpg2 and AVI. I don't know of any that will do mpg4.
Carl may be attacking your problem another way so we may be asking a lot of the same and a few different questions.
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BoilerPlate: To posters who ask for help -- it is nice to thank the volunteers who try to answer your questions !
Anything I post unless stated with a reference is my personal opinion.