Yes, it is possible. One can get about an hour of good quality video onto a 700MB CD.
However, to do this, you need to invest a fair deal of time and money. One needs to purchase a video capture card for your PC, and perhaps some capture software, which might run a a couple hundred bucks, depending on the features you want. The time comes in in both the time it takes to learn the ins & outs of the capture/editing process, and the time it takes to actually capture & compress the video.
Personally, I have a ATI All-in-Wonder Radeon, which is a combination 3D Video card and capture card. However, if you have a video card that you'd like to keep, you can buy a separate card, or a USB capture device. I've never used one of these things, so your mileage may vary.
As for software, the cheapest is VirtualDub, which is freeware. However, it isn't user friendly, and has a steep learning curve. Couple this with the DivX codec (free, but buggy, and with questionable legality) and you should be all set. With a recent computer, you should be able to capture & compress in real-time with VirtualDub & DivX, with minimal frame-drop.
Short answer: It is possible, but takes some money & a lot of know-how. If the video isn't private in nature, you may be able to get a local computer geek to do it for you.