Your definition of free is different from mine.
This is a very good open source recording/streaming program. Great if you're new and don't want to pay for fraps. Easy to set-up and high quality, it's what I use when I need to record stuff, admitedly not very often, but I've never had an issue with it.
http://obsproject.com/
In the broadcast settings you can switch it to save footage locally to a file instead of stream, it does both.
What settings do you use for OBS? The flv it's putting out is all laggy and the sound doesn't match the action on screen (which isn't fluid at all).