Do you have Videocamera with USB or Firewire Output?
If so, copy (record) the VHS movie to the camera. Capture the camera's output using Windows Movie Maker (or other video capture program). No video capture card required!
WMM captures in .wmv format. Convert this to MPEG (using any number of freeware file format converters) or use another capture program that captures in MPEG format.