Camera format: uncompressed or compressed

Some USB cameras, and HDMI capture sticks especially, can send their picture two ways. Compressed sends each frame as a JPEG for the Mac to decode. If a frame loses data on the way in, everything below the damage decodes wrong: the top of the picture is fine, and below a line it's washed out, dark or the wrong colour. Uncompressed sends the picture as it is, so there is nothing to decode and that damage can't happen. It needs much more USB bandwidth, so cameras only offer it at sizes and frame rates the cable can carry.

• Automatic (the default) uses uncompressed whenever the camera offers it fast enough to record smoothly at this resolution, and compressed otherwise.
• Uncompressed uses it whenever the camera offers it at this resolution, even if that means fewer frames per second.
• Compressed never uses it, for a camera whose uncompressed mode misbehaves.

In use shows what the camera is actually doing. If it still says Compressed with Uncompressed chosen, this camera doesn't offer it at this resolution: try a lower one under Resolution, just above.

If damaged frames continue even when uncompressed, they're coming from before the USB link, in the capture stick itself or the HDMI signal reaching it. Try a different cable, plugging the stick straight into the Mac rather than through a hub, or another capture device.