On the PC, there is the free Windows Media Encoder, and there is the paid Camtasia Studio. Both do a good job for most projects.
On the mac, there is Ambrosia Software's SnapzProX, a great utility. Probably the best thing to do, but maybe not possible because your content is gaming based (is it a computer or console game, and if computer, does it use OpenGL?), is to buy a hardware card like a cheap DeckLink board and use its Desktop video output feature to a SDI device to recapture it back in at full Uncompressed glory.
While these solutions should work at least somewhat in all cases, I still don't understand why you want to upres the content when editing it. Seems pointless to upres at the editing stage.
Also, Camtasia and WME are designed for normal computer-like tasks, like IE and Word. If it's a full-screen video game, both will slow to a crawl. You're better off with a scan converter in those cases, which could take VGA to SDI, and then capture from that with an SDI capture card.
There are also DVI to HD-SDI converts if you really want to work in HD. 1280x720 60p works great with some games, and looks great as well.