There is absolutely no loss at all capturing DV through 1394/firewire connection to a computer file. It is bit-for-bit identical. When editing in VF, there is some quality loss whenever new video must be created. Supposedly, according to Sonic Foundry support people in other posts, if you merely trim and rearrange your footage (i.e., you don't make any changes that would cause any pixel in a frame to change), then the video is not changed and is identical when you print to tape. Thus, in most editing, parts of your project are unchanged (those that are merely trimmed or moved to a different place on the timeline) and some are changed (transitisions, title overlays, special FX, etc.). In this case, parts of the project will have some quality loss.

You can find dozens, perhaps hundreds, of posts about this subject both on this forum and on the Usenet groups. Many people have done tests where they capture video, make a trivial change to force the software to re-compress the footage, and then print it back to tape. They then recapture that footage and repeat the process. They then compare the original with the first, second, third ... and nth generation copy and report on where they can begin to see a difference. With the standard Microsoft codec (which is what VF uses), most users say they can spot a difference after only 2-3 generations. What this says, however, is that if you only capture and edit once (which most of us do), the quality loss is inperceptible.

If you are quality obsessed, you can upgrade to Vegas which has its own codec which is both faster and better quality, or you can purchase the Mainconcept codec for $50. Some users report no visible degradation even after half a dozens generations when using the Mainconcept codec. Here is one such comparison Generation Loss.

John