I don't have an answer for your audio/video issue. I know my daughter posts vids made with her digital camera that include audio. They're short, but clear. Sound quality doesn't matter that much really.

As far as the rest of your post...

EVERYONE has something to offer when it comes to playing. I've learned things from beginners, experts and every level in between. Your level of play has less to do with things than your technique. Closeups of fingerings, regardless of audio quality, would probably be the best thing you could record. Never consider yourself less of a guitar player than others. You are unique. I used to feel the same way you do, (in that I felt there wasn't necessarily a lot I could offer because I wasn't the best player around,) and was embarrased that I couldn't just "jam" with people, (a skill I still struggle with.) I had another guitar player say to me once, "I don't expect that you can play what I play or how I play it without a lot of practice. It's my style and it suits ME. By the same token, I can't play what you play without a lot of practice either, because your style is completely different from mine and it suits YOU."

We develop individual styles based on what we learn from others, so it's not how well you play something, but what you do to play it. Sure someone else may trump you with your own stuff, but that just means that you got your point across.

1 - Does your cam has a microphone ?
2 - Do you have a microphone ?
3 - Is your XBox cam working on your computer ? (USB ?)
4 - Try Virtual dub for your captures : http://www.virtualdub.org/