I used Windows Movie Maker, but don't expect great results. WMV, like WMA, is a format which produces small files, but worse than the 'original' ones (AVI and MP3).
You could try Windows Media Encoder which is a lot more configurable. Download it here; http://www.microsoft.com/windows/windowsmedia/forpros/encoder/default.mspx It takes a while to set it up well but you can save your settings for later use. You can also create ASF files with this which some personal video recorders can play - mine does! Its quite a useful feature.
i have windows media encoder but it all way fails when i try to encode divx or xvid.. it seems to me that it only handle offical microsoft video codecs
