1. What software do you use to broadcast? What settings do you use?

VHScrCap, a free screen capture driver for windows. The software is fairly easy to configure, and works just like webcam software that allows screen capturing do. The software comes with an additional program, VHMultiCam, that I now use for additional features, such as blocking parts of the screen. The program is amazing and allows you to do quite a bit of awesome stuff with it.

UPDATE: The free version of VHScrCap is no longer available, and has been replaced by XSplit.

Flash Media Encoder 2.5, a free media encoder software for windows that also has easy streaming to Justin.TV and other video sites built in. I use the command line version, which saves on CPU and memory utilization quite a bit also.

Flash Media Live Encoder 3.1, the newer version of Flash Media Encoder. Sometimes I get better quality with this version, and sometimes it is worse, so I switch between 2.5 and 3.1 regularly.

Please note that settings are PC and ISP dependant. What works for me probably won't work for you without some tweaking. That said, I have my broadcasting screen set to a resolution of 1280x800. This is a 16:10 resolution, and will allow your games to look the same (for the most part) as if you had it at 1920x1200 or 1680x1050. With my resolution set, I then have my VHScrCap set as shown here.

After VHScrCap, I have my FME 2.5 settings saved to an XML file that I load with the command-line version. My FME settings are shown here. Also note that I change FME settings based on what I am casting. For example, when I cast FF7 I drop the resolution capture in VHScrCap and increase the framerates in both VHScrCap and FME.