Camtasia which can capture from SDL windows. Its a case of:
RemoteJoySDL (3.71 M33 updated version) streaming to an SDL window on my desktop.
Line In cable connected from PSP headphone socket to PC line in socket.
Camtasia Captures Audio from line in and captures the SDL window, only needs a few settings tweaked to get the desired output, set it to capture at 30 FPS, pick your poison for video codecs and make sure its using Line in, not Mic etc.