Yeah, the problem with the Dazzle stuff is that a) you're not going to get very good quality because of poor resolution, compression artifacts, and less than 30 frames/second frame rate, and b) it's tough to get the audio recorded and synced up properly with those things, regardless of what the promo sheet says. There is simply no physical way to capture good quality audio and video over USB 1.1. Not possible.
The higher end Pinnacle stuff is better, but also more expensive. Guess it all depends on what you need. If you're willing to do two passes with the Dazzle, one for video and one for audio, and then try to sync them afterwards in Premiere, you'll probably be able to pull off VHS quality stuff (although the compression artifacts are going to make any stuff with a lot of fast motion look funky). But you're definitely not going to get anything better than VHS quality stuff from the Dazzle.
Either way, everyone is correct about needing a lot of RAM and a big, fast hard drive (and a fast processor, of course). If you've got the money, make sure that you get a 7200rpm hard drive with an 8MB buffer, not a 2MB buffer. This greatly increases the speed of the drive and reduces the chances of dropping frames. Also, if you get another drive, keep your old one and just use the new drive for video and audio files. Run everything else off of the old drive (OS, capture software, editiing software, etc). This also reduces the load on the hard drive.
On a side note, Premiere 6 is actually a wonderful program. It now has real-time preview and more audio options, which were the only things (and they were pretty major things) Vegas had on it. Plus, the integration it has with Photoshop, Illustrator, and especially After Effects makes it invaluable for anyone who does a lot of professional post work.
Good luck,
Ryan