I want to start recording myself playing games to put it on youtube.. what do I need?

More specifically the game I've been playing recently is shogun 2 total war. I want to take some of my match replays and turn them into a cinematic movie to show off some of my cool strategies, and then of course I want to upload the movies to vimeo/youtube/etc, and I'd like the videos to be atleast in 720p, or hopefully in 1080p if I can do that.

First of all, do I need a really killer machine to record videos? I can run shogun 2 in all ultra settings pretty comfortably, I'm not sure how well it'll go if I'm recording at the same time. I'd preferablly like to not have to turn down my settings significantly since this is sort of supposed to be a cinematic thing. (my machine: windows 7 64bit, amd athlon II x4 640 3.0ghz, 4gb ram, radeon HD 6850 1gb)

I know there is a program called fraps, I'm not sure if it's the best program to use. What do commentators on youtube usually use?

Is there any advice anyone has for me in general?