By default, conversion to WMV uses the Microsoft Screen Codec, which is optimized for screen recordings and produces very small videos.
However, the Screen Codec will cause blurry fonts when the screen recording is done with the Windows ClearType technology enabled. This problem may also occur when you significantly resize the video during conversion.
To overcome this problem, you must make screen recordings with features like ClearType turned off. Changing Windows XP's theme to Classic will also help.
You can change both these settings from Display Properties. To open Display Properties, right click on the Desktop and select Properties.