To expand on Charlie's answer....
FRAPS is probably the most used utility out there to make Flight Simulator videos. Just like there are utilities to capture screen shots, FRAPS captures screen shots while they're being produced, all at once therebye giving you a "video" of the action.
It will put a drag on your frame rates so if you don't have good frame rates in the first place running FRAPS to capture video will result in jumping and stuttering in your playbacks. You can help this by adjusting the levels of display to improve your frame rates.
Best of all, FRAPS is availabe in a trial-ware format that allows you to use it for free. I finally broke down and paid for it as the free-ware version contains a "Fraps.com" banner across the screen at the top of all the playbacks.
When you finally capture some clips you want to put together into a video then you'll need a program like Windows Movie Maker to piece the clips together. I believe WMM comes standard with Windows XP. I didn't even know I had it until I ran a search on my machine for it, who knew
