Errata -

If it is desired to product videos that resize to an expanding window, then there is an additional option that needs to be checked on the Controls tab that is accessed from the Flash Options button on the Flash Templates Screen of the Production Wizard to "Allow resizing".

Bruce's original notes regarding his recording settings:

I record in -

1024 x 768
Tru color (32 or 24 bit)
5 frames / second - this is fine for screen captures and mouse movements and even fade-in/fade/out
PCM, 22 KHz, 16 bit, mono sound

Then I render with the following setup for SWF

1024 x 768
16 or 32 bit color (depending on content - I use a lot of gradient charts that require 32 bit)
5 frames / second
ADPCM, 22 KHz, 4 bit, mono, 88 kbits/sec (a slightly better alternative if you have lead-in/lead-out music is 22 KHz, 5 bit, mono, 110 kbits/sec)

And here’s a video Bruce sent me referencing where he found this information.

http://www.membergate.com/public/280.cfm

My Normal Setup

I usually record at 1024 x 768, which is to say that I set the screen resolution before I record.  Note from Bruce's video that it's important to record and produce at the same resolution. I’m using Camtasia 5, and here are my settings:

Before I record, I have my audio settings configured as follows:

After I’ve recorded, I’ll configure the editing dimensions as follows:

I'll usually select Recording Dimensions.  You can ignore the box around the 800x600 option.  I'll only use this if I've recorded at 800x600.

I’ll edit my video and then when I produce it, I have the following settings which are unique:

In the first screen, I choose Custom production settings as follows:

In the next screen, I choose to produce an SWF file as follows:

In the Flash Templates screen, I click the Flash Options button as follows:

And here are the screenshots for the first 2 tabs in this dialog: