If you buy fraps the newest version removes the 4 gig limit. I can't give any advice on the age verification... I never had to go through it myself.
I record with Fraps and edit/compress using Virtual Dub, a free program. I use the free xvid codec to compress, it seems to work pretty well with youtube.
Long videos at 1080p get really big and it would take me a long time to upload. I recorded an hours worth of footage for Legend of Grimrock and then realized that it came out to 10 GB... I just gave up and deleted it. If you limit to 720p it goes faster, I suppose you can lower quality on the compression as well.
How large are your files in MB/minute Das123?