Launch Livestream Procaster from your start menu. If it asks if you want to change your Windows 7 style, select 'Always'.
You'll be greeted with the following screen after logging in:
Click the Prefrences button in the lower right.
In the new windows, go to the Desktop tab, and disable mouse highlighting or the cursor altogether, depending on your effect. (In the WoM client, your mouse will always appear in the middle when recording, and will jitter around when you move it. Hiding your mouse fixes this).
Also, check the box saying 'Save video to file (My Videos folder)', as this will put a compressed MP4 in your MyVideos folder, which is what you want.
After setting all of these, click "Save" and then hit the big red button in the middle saying "Go Live".
When recording, you'll see a bar at the bottom of your screen with statistics, and a small preview window, and green lines around your screen. These lines are the recording area, you can move them to fit around a window you want to record, rather than everything. Fit these lines around the WoM client window, rather than resize the WoM client window because it will slow your machine down.
Do what needs to be done, then hit the red "Stop" button in the bottom bar. Wait until your video has stopped recording and you may be asked to name your video. This is for the online service, if you want other people to view your stream, give it a name and click upload (or whatever button) otherwise, just click the 'Delete Video' button to not send it to Livestream.com. Your video will still be saved in your folder. You should now be able to see your video in your MyVideos folder.